Overview
International corruption costs the world over $3.6 trillion every year, while persistent corruption has undermined healthcare systems during the pandemic. How can government, business and civil society ensure the transparency and good governance needed to set society on an effective path towards an inclusive and sustainable recovery?
Outcomes
- With great focus being put on the “E” and “S” elements of the ESG framework, Good Governance (“G”) remains critical for an inclusive, sustainable and effective economic recovery
- Companies need to build a robust culture and align different topics like human rights, compliance and environmental agendas in order to achieve greater impact
- Responsible and visible leadership and tone from the top are critical, but middle management plays a key role in building a culture of integrity
Summary
Over the past year, there has been significant global focus and spotlight on the environmental and social aspects of ESG, taking a broad lens on the complex and cross cutting impact of these issues on our society. The “G” in the ESG often is limited to the topics of board diversity and compliance but there is an opportunity to add additional elements to this discussion, focusing on building a culture of ethics and integrity that can have a broader positive spill-over effect in addressing critical global challenges such as climate change and human rights abuse. The World Economic Forum’s Global Future Council (GFC) on Transparency and Anti-Corruption is launching an innovative playbook that studies the rising role of the “Chief Integrity Officer” in converging approaches and aligning topics such as integrity, sustainability and human rights for achieving greater impact, strengthening the “G” and delivering on the entire ESG framework.
According to Anna Tunkel, Head of Strategic Initiatives and Global Partnerships at APCO Worldwide, transparency and integrity are critical values for sustainable governance, however, “inspirational ethics” is what will drive real change. Employees do not want to be told what they should or should not do but want to be inspired into what they should be doing. Five key trends in good governance are:
- Mission evolution: shifting from policing to building a culture of integrity – from litigation to inspiration
- Skillset evolution: new skills are needed in today’s world – e.g., behavioural science, data analytics, sustainability
- Advancing a common advocacy agenda: advocating for issues that stakeholder care about
- Joining forces to multiply impact: collective action can create a ripple effect
- Leveraging technology for integrity: technology is accelerating and must be employed to combat corruption and detect areas of vulnerability
In order for companies to address agendas like anti-corruption, climate change and human rights, they need to follow the “3A’s approach”: Alignment, Authenticity and Advocacy. Companies need to focus on aligning areas to achieve greater impact and remain credible to the values that they are championing.
David Flavell, Executive Vice President, General Counsel and Corporate Secretary at PepsiCo, illustrated how business integrity has evolved at PepsiCo as a good example. Sustainability and human rights targets are not elements that a company must add on to its business model, instead they present a fundamental relook about how business should be conducted. According to David, companies should not just follow a rule-based approach to achieve ESG targets – everyone has to be on board and convinced for the needle to move.
According to Kristian Heydenreich, Senior Director, Global Head of Compliance and Corporate Social Responsibility at Vestas, the point of departure in this journey is the Legal Department with codes of conduct and internal tools, but the objective is much broader. The approach needs to follow better alignment between different topics and a common language, including on due diligence.
The moderator concluded the session announcing that the playbook “The Rise of The Chief Integrity Officer” will be launched next month and it will focus on these issues in more depth bringing together best practices from the public and private sectors and offering solutions on how to best align and converge approaches to topics like integrity, anti-corruption, sustainability and human rights, among others.
Simultaneous interpretation in English, French, Spanish, Chinese, Arabic and Russian