Many are aware of governance as a core element of sustainable and responsible business practices, primarily given to the increasing popularity of ESG criteria among companies and financial actors alike. In fact, even international institutions are beginning to implement these; it is the case with the European Union and its recently developed sustainable financial market, for example.
We can confidently state that the protection of the environment and the wellbeing of society are interdependent from a good, comprehensive and responsible governance, and so we have set ourselves to get a more holistic approach and understanding of governance.
The magnitude of current global threats cannot be dealt with by States alone; other actors, including the private sector, are needed.
Global problems need global solutions
The idea of globalization is inescapable, and it has been for centuries, but what does globalization have to do with good governance?
Well, since the world is global, so are its problems and challenges today and in the foreseeable future; we can take for example some of the latest events, such as the economic, climate and sanitary crisis, and it becomes clear that actions and solutions need to be taken collectively. As Secretary General of the UN Antonio Guterres stated, we need global responses to global threats.
However, while multilateralism and international cooperation have long been thought to be traditionally a governmental question, we are beginning to see a shift of ideas in this regard, as it is difficult to escape the fact that the magnitude of current global threats cannot be dealt with by States alone; other actors, including the private sector, are needed in the path towards effective and collective responses to push sustainable development, equality and prosperity forward.
SDG 16: Peace, justice and strong institutions
It is in this context that SDG 16 on peace, justice and strong institutions finds its roots in the need for global multilateralism to become a reality and build up a society based upon the cooperation of companies, governments and other organizations for sustainable development.
The main idea behind this objective’s targets is to help build back the basis for an environment in which governments, civil society and companies cooperate in an effort to fight corruption, strengthen social cohesion and create resilience against the increasingly severe economic and environmental crisis.
However, it seems as though companies have not seen the potential of their power and influence over this particular SDG, underestimating the impact they have on such matters.
It is about expanding the ‘G’ in ESG in order to adapt and align with current global needs.
What is transformative governance?
Now that we have set off the current context of the world and its targets for the near future, it is time to understand how governance can help achieve these, and most importantly what does this kind of governance look like.
Governance refers to the processes, structures and ways people and institutions, including companies, use to build up their collective activities. The kind of governance that today’s current global realities call for is, or should be, transformative and multilateral.
A transformative governance is one that takes on a holistic approach to ESG necessities; this is, understanding the state of its internal functioning as well as the needs and threats of what surrounds it, and responding accordingly in all of its branches: social, environmental and governance itself.
It is about expanding the ‘G’ in ESG in order to adapt and align with current global needs. Companies can actually find benefits internally and externally by applying a transformative governance model; on the one hand, as we know, these criteria will help them be more sustainable and therefore improve ESG ratings; on the other hand, externally, it will portray an image of responsible and ethical leadership that can help promote a more inclusive and just system overall.
Going back to what we have said before, as the world is increasingly interconnected, problems and challenges in one side of the world are not isolated to the rest of the globe; the same thing applies to solutions, improvements and transformative governance initiatives. The latter will expand and create a society where people and business can thrive.
Transformative and transparent governance
We believe and work for transparency to be one of the key values driving the fight for climate action, social wellbeing and good governance as it is the only way to understand what we are doing wrong, what we are doing right and what it is that we are not doing yet.
Because being transparent is not only an externality to a company, or a given organization, to help build trust and reputation; it is in fact also a great learning and improvement mechanism. You cannot manage what you don’t understand. And so we advocate for transparency, integrity and precision as imperatives to the fight against climate change.
In DoGood we are convinced of the need to understand and manage efforts to achieve a sustainable transition inside an organization for the correct and efficient functioning of the business and the community it operates in. We alone cannot achieve the substantial changes necessary, but we work on the basis of collaboration, transparency and accuracy in order to bring light to sustainable actions.
In this regard, it is essential to our work to promote good corporate governance, meaning that the processes of disclosure and transparency are followed so as to provide regulators and shareholders as well as the general public with precise and accurate information about the financial, operational and other aspects of the company, including a more accurate definition of the ESG performance.
We have developed a corporate government tool that helps establish ESG impact objectives for employees in regards to the sustainability strategy of the company. Through our technology we are able to activate and track employees’ impact, creating engagement that translates into improved ESG metrics, reputational value and an overall positive impact for the environment and society.