Governance for sustainability of corporations: continuous creation of value

Abstract

Corporations command a significant part of global resources, create value for customers throughout the world, and have an influence over an even larger number of people through their influence on their stakeholders. Therefore, their ability to create value for their stakeholders and their sustainability is important for improving quality of life. The essence of good corporate governance is ensuring trustworthy relations between the corporation and its stakeholders. Corporations that flourish through the use of the world’s resources are becoming increasingly aware that they need to be accountable toward all parties that have a stake in those resources. As our dependence on global resources increases, we need to be aware of the need to have our governance systems and attitudes gain a global dimension. Today, successful and sustainable organizations need to demonstrate a willingness to involve stakeholders in decision making, to embrace a culture of transparency and accountability, to be fair and consistent in relations with stakeholders, and to have an organizational infrastructure that ensures “corporate trust.” Trust is the foundation of success. It is at the foundation of all relationships. As the world continues to get smaller, the interdependence between corporations and their stakeholders grows larger. Companies who earn the trust of their stakeholders are able to mobilize more resources throughout their value chain to achieve sustainable success. This is the fundamental reason why good corporate governance is being embraced by companies in diverse industries, small and large, publicly or privately owned, throughout the world.