The Institute of Directors South Africa’s (IoDSA) envisions a more active role for Social and Ethics Committees (SECs), one that sees these committees moving beyond mere monitoring and reporting compliance towards active contribution to organisational strategy.
The IoDSA’s SEC report The Role of Social and Ethics Committees in ESG Monitoring and Reporting, proposes that SECs, entrusted with the responsibility of keeping governing bodies engaged on social and ethics matters that are integral to core operations, might play a more central part on ESG (environmental, social and governance) matters.
“Companies should take note, as ESG is a key issue for corporations and the SEC. Often governance, monitoring and reporting processes are disorganised and not as effective as they could be. The proactive involvement of an SEC can make a substantial, positive difference,” says Trialogue Managing Director and report lead author Nick Rockey.
The report offers high-level guidance to SECs on the role of monitoring and reporting of ESG within the interrelated nature of SECs’ roles and responsibilities. It explores the following;
- The nature of the SEC mandate at how it interacts with ESG.
- The business context for ESG, its relevance to companies and how it is informed by codes and standards, as well as the principles underpinning ESG processes and how ESG topics are determined.
- Overview of ESG governance.
- The role of SEC in monitoring and reporting.
Speaking at the launch of the report Rockey said, “Business has a massive role in terms of its influence both in terms of mitigating negative societal and environmental impacts, but also ultimately improving through a shared value proposition the world in which it operates. This is critical if you look at the three primary participants in society; government, civil society and business. The size of business, particularly global businesses, is huge and significant. Through that footprint it could have a really meaningful impact on the world in which it operates. We point that out in terms of the relevance to business and the importance of business to actually take on these issues.”
The report highlights this responsibility, exploring how SECs are uniquely positioned to influence ESG business integration and significantly impact on business and society stakeholders through a strategic and proactive approach.
Read the full report:The Role of Social and Ethics Committees in ESG Monitoring and Reporting
The IoDSA assists members and those charged with governance to apply governance theory in practice. In conjunction with various collaborators and sponsors, IoDSA has established forums mirroring that of a board and committee structure. The forums serve as hubs for corporate governance professionals to combine their knowledge and experience in order to raise awareness, stimulate dialogue and provide guidance on governance matters. Trialogue is a member of the IoDSA Social and Ethics Committee forum.
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