Takeways from IEE Roundtables

May 8, 2019, CSR & Sustainability Roundtable
Unpacking Larry Fink’s Letters to CEOs and Board Chairs

Led by Sandy Rothe, retired managing partner, Deloitte

  1. Private companies have become significantly more accepting of the oversight function of boards of directors.

    It is still hard to directly speak about ethics within boards and between the board and management; yet, there are several discussions about topics deeply connected with ethics.

    Two issues at the core of fostering ethical governance and management culture are trust and communication.

  2. Onboarding processes for new directors are crucial to set a tone and expectations that meet standards of trust and communication.

    Yet continuous processes aimed at sharing values (not just formal meetings) and assessing culture (are we who we think we are?) are crucial to strengthen the role of the board within private companies.

  3. Strong, effective boards of private companies then have a unique opportunity to nurture corporate social responsibility through a deeper sense of purpose, long-term oriented strategies and greater alignment with all stakeholders.

    And if all other stakeholders are taken care of, then shareholders are taken care of as well.

March 7, 2019 Governance & Leadership Roundtable
Understanding and Managing Ethical Dilemmas in Privately Held Companies

Led by Bill Heck, chairman emeritus, NACD Colorado Chapter, and Hugh Rice, senior chairman, FMI Capital Advisors, Inc.

  1. Corporate social responsibility means different things for companies in different industries and at different stages of development.

    However, a stakeholder (not just shareholder) approach to management and governance is imperative for a successful business. For this reason, reflecting and nurturing a sense of purpose could become a distinctive competitive advantage.

    Boards should help management shifting from fear of not being relevant to aspiration to become relevant.

  2. Balancing short-term results and long-term value is a critical issue for investment managers, since different stakeholders have different time horizons.

    Chris Pelley suggested Willful Blindness by M. Heffernan, which explores how at times we ignore apparent threats and what mechanisms to use to overcome resistance to change.

    Boards should help management engage in discussions about future risks to anticipate the future rather than simply rationalizing the past.

  3. Addressing societal, including political, issues can be vital for international companies.

    Complexities and uncertainty in the economic, social and environmental environments boost the relevance of CSR strategies, policies and initiatives.

    Boards should provide the impetus to undertake proactive rather than reactive CSR.

  4. Younger generations are more sensitive to CSR cultures within business organizations. They demand more and can be more equipped to navigate the complexity of stakeholder management.

    Higher education has contributed to fostering a broader view of the nature and value of capitalism.

    Boards should be characterized by diversity of perspectives to leverage the richness of different backgrounds, experiences, and views.

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