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Collective governance contributes to both diversity and corporate social responsibility (CSR). How can companies implement it correctly?
Modern governance encompasses much more than financial and legal skills. It also requires representation that reflects the diversity of our society and integrating a range of perspectives to enhance the decision-making process and corporate strategy.
As a result, participatory governance and best practices are becoming key levers for companies that wish to focus on their social impact. This transition to a more inclusive and representative form of governance is in response to current social expectations and also a crucial step towards building a sustainable future.
Below are examples of how to apply the principles of social responsibility to corporate practices.
Optimized governance structure
Since companies must adapt to a rapidly-changing business environment and a labour shortage that has hit several sectors, reviewing your governance structure may become an essential step. A growing need for social and environmental responsibility means that you must review your approach.
How does the process work?
The first step involves analyzing the existing governance structures in order to recommend appropriate changes. A personalized governance approach may include:
- A diagnostic;
- Training workshops;
- Ongoing support.
The objective of this exercise is to enhance the company’s Agility, Behaviour, Cooperation and Diligence. As a result, your governance will be more representative and skilled and able to respond to current and future challenges.
Expected results
It’s in a business’s interest to strengthen its ability to make informed decisions that reflect today’s reality.
This approach will lead organizations to different conclusions. In concrete terms, this could involve:
- Appointing new members to the Board of Directors;
- More emphasis on diversity and inclusion;
- Increased awareness of environmental issues.
The process may foster greater involvement by the various stakeholders. This involvement will ensure that governance is collective and also aligned with the aspirations and values of employees, clients and the community.
Profitable diversity
It’s never too early to begin an organizational governance assessment, but many companies decide to set this process in motion due to their business reality. For example:
- A Board of Directors made up of long-standing members has created a closed circle;
- The loss of an influential member of the management team;
- A need for better representation within the organization.
In such cases, the process is essentially the same. The first step involves a comprehensive diagnostic of the organization’s current governance through workshops and consultation sessions that focus on specific diversity needs.
The objective is to ensure the Board reflects the diversity (First Nations and women, for example) of the partners and clients in question and strives for:
- Major changes to the Board of Directors through the creation of new committees;
- Increased representation;
- The implementation of more robust and inclusive governance practices.
In this way, organizations can better respond to the needs of their communities while moving towards sustainable and responsible growth. The impact of such overhauls can allow companies to tackle current challenges while remaining in line with the values and aspirations of the various parties involved.
Family businesses exploring external governance
Family businesses may also need to undertake a governance review process. Where all shareholders are family members, expanding the governance circle and adding an external perspective and complementary skills can be transformative.
Governance analysis and review involves strategic recruitment and redefining the roles and responsibilities of board members in order to better adapt to the new market realities and societal expectations.
The introduction of collective governance can lead to major changes within the organizational culture and the company’s decision-making process. Appointing new external board members will bring new skills and perspectives that will enhance the decision-making process and help the organization to transition to sustainable governance practices.
The goal of this transformation is to bolster the organization’s position on the market while simultaneously improving its brand image as a socially responsible company that can effectively tackle today’s challenges.
A more responsible future
Participatory governance and the adoption of best practices can transform businesses. Such companies can evolve towards more inclusive and agile governance in line with today’s environmental and societal challenges. They strengthen their internal culture, social responsibility and brand image.
Our team is proud to play an active role in supporting businesses as they transition towards a more responsible and sustainable future. Contact us to find out more.