The UN Global Compact today launched an innovative programme to help move sustainability issues from the backroom to the boardroom, so that companies can better manage risk and opportunities for growth by developing solutions that respond to the future demands of people and needs of the planet.
As the first of its kind, the Global Compact Board Programme supports Boards of Directors to effectively oversee and drive a strategic approach to corporate sustainability, and to respond to the interests of all their key stakeholders while protecting and creating financial value.
Developed by Global Compact LEAD and the Principles for Responsible Management Education (PRME) – in collaboration with knowledge partners The Boston Consulting Group (BCG) and DLA Piper – the Board Programme seeks to accelerate recognition by corporate leaders of the material impacts of non-financial issues, and integrate sustainability into business strategy and operations.
“In order to move towards more inclusive and sustainable markets, there must be full ownership and oversight at the highest levels of corporate governance and decision-making,” said Georg Kell, UN Global Compact Executive Director. “Boards of Directors are uniquely positioned to ensure the long-term viability of the business and to recruit and create the right incentives for the next generation of business leaders. Our goal is to put sustainability on both the CEO and Board agendas like never before.”
Board adoption and oversight of corporate sustainability, while on the rise in some respects, represents an area where vast improvement and gains can be achieved, as companies often demonstrate a “performance gap” between ambition and execution on sustainability. In a recent survey of nearly 2,000 Global Compact companies, 90 percent stated that their Boards discuss and act on sustainability issues, while only 15 percent provide corporate responsibility training for Board members.
The Board Programme aims to support Boards in the following ways:
- Align on the strategic imperative of corporate sustainability as critical for the company’s long-term viability and the distinction between issues that are strategic and non-strategic to the industry.
- Realize the integral role that Board members can and should play in overseeing, incentivizing and driving corporate sustainability, embedding it into Board duties and structures.
- Demonstrate leadership on Board adoption and oversight of corporate sustainability with investors, employees, customers and other stakeholders.
Organized in two strategic sessions on the “Materiality of Sustainability” and “The Role of the Board”, the Board Programme features in-house delivery by a global roster of expert facilitators with corporate governance and sustainability expertise across a number of industries. To ensure maximum relevance and impact, the Programme is customized to the needs of the individual company and carried out as a collaborative effort over the course of two to three months. The Programme offers access to a database of expertise and resources across sustainability, strategy, governance and business model innovation topics designed specifically for Boards of Directors.
“Because it can affect the long-term competitive and financial performance of a company, sustainability is now firmly on the corporate agenda,” stated Martin Reeves, a BCG senior partner who collaborated on the design of the Programme. “Therefore, boards of directors, as the highest decision making bodies of corporations, have an essential role to play. The Global Compact Board Programme, which BCG is privileged to support, helps boards identify and understand the key sustainability issues for their organizations—and define the right policies and governance structures for the specific business contexts they face.”
Six Global Compact LEAD companies from Europe, Asia and Africa – Enel S.p.S., Eni S.p.A., Eskom, SK Telecom, Sinopec Limited and Yara International ASA – have piloted the Board Programme. Guided by the experiences of these LEAD companies, the Programme will now be made available to all UN Global Compact corporate participants with relevant governance models. In addition, Global Compact Local Networks in South Africa, Italy, Brazil and China will work to elevate awareness around the crucial roles of Boards within their countries.
The Board Programme is being launched during today’s 5th Global Compact LEAD Symposium, which will challenge participants to sketch a vision for “The Future Corporation”. LEAD companies and invited experts will identify key characteristics of what the sustainable corporation could and should look like in the future – how it will be governed, create value and manage its impact on society – highlighting the transition of the global business community that is already underway, fueled by deeper integration of sustainability into strategies and operations.
About Global Compact LEAD – Innovation through Action
Global Compact LEAD is an exclusive platform designed to engage the most committed companies within the Global Compact to lead the way to a new era of sustainability. With participation from sustainability leaders from all regions and sectors, LEAD brings a wealth of expertise to the challenge of achieving higher levels of corporate sustainability performance. See full list of over 50 LEAD participants and learn more at www.unglobalcompact.org/LEAD.