Mark Goyder discusses how changing trends in shareholder ownership will affect the decisions of executives and what this could mean for sustainable policies.  This article was published by Ethical Corporation in July. Mark Goyder is founder director of Tomorrow’s Company.  Mark holds a number of other positions, including British Airways Corporate Responsibility Board; BT Leadership Advisory Panel; Camelot Advisory Panel for Social Responsibility and Judge for Unipart group Mark in action awards. He was named Director of the month, June 2004, by Director Magazine and won the IMS Millenium award for best speaker.

This paper introduces the Trust Enablement™ approach to corporate governance, as a natural and harmonizing counterbalance to prevailing risk management practices.Recent attempts to restore confidence in capital markets have been based largely on risk management practices that place greater emphasis on protecting organizations from further erosion of trust than on establishing higher levels of trust and confidence. Efforts focused on proactively building trust yield better results than recent risk management reactions to mistrust.  A complementary, offensive trust and confidence-building strategy is therefore proposed as more effective for reducing director and officer liability exposures and enhancing business value than a prevailing defensive, risk management strategy.Comparative examples of current governance practices and proposed initiatives when mapped to the Trust Enablement™ model reveal a deficiency in trust and confidence-building governance mechanisms.  Trust Enablement™,...

Natural capital – our ecosystems, biodiversity, and natural resources – underpins economies, societies and individual wellbeing. The values of its myriad benefits are, however, often overlooked or poorly understood. They are rarely taken fully into accountthrough economic signals in markets, or in day to day decisions by business and citizens, nor indeed reflected adequately in the accounts of society. The steady loss of forests, soils, wetlands and coral reefs is closely tied to this economic invisibility. So too are the losses of species and of productive assets like fisheries, driven partly by ignoring values beyond the immediate and private. We are running down our natural capital stock without understanding the value of what we are losing. Missed opportunities to invest in this natural capital contribute to the biodiversity crisisthat is becoming more evident and more pressing by the day. The degradation of soils, air, water and biological resources can negatively impact on...

Innovest Strategic Value Advisors and the Environment Agency co-wrote a study in 2004 that provides a useful literature review of how responsible investment effects financial returns.  Furthermore there are fifteen case studies that look at how ESG policies have improved the profitability of companies ranging from Shell to Xstrata Plc.

The researchers from the Grantham Research Institute on Climate Change and the Environment and the Centre for Climate Change Economics and Policy conclude that about US$400 billion should be spent worldwide on ‘green’ policies and investments which also help economic recovery and lay the foundations of sustainable low-carbon growth. The report, ‘An outline of the case for a ‘green’ stimulus’, points out that this sum represents about 20 per cent of the US$2 trillion, or 4 per cent of global gross domestic product, that governments might spend in the next 18 months on fiscal stimulus packages to lessen the economic downturn.