Board Effectiveness: What is POOR, OKAY, GOOD or EXCELLENT?

6 June 2016

Sarah Wilson

EU regulation

Does anyone know? Not yet. But, by the end of this month, the ethics think tank Responsible 100 believes it will have a better idea.

The problem Responsible 100 seeks to solve is the credibility deficit endured by businesses which claim to be ethical, sustainable, responsible or values-driven. Responsible 100 believes that that businesses which actually mean it when they say such things must prove it. Furthermore, demonstrating transparency and accountability on all the social, environmental and ethical issues which affect business and wider society requires robust proof.

Speaking to R100's founder and Managing Director, Michael Solomon explained philosophy behind the Responsible 100 concept to Manifest. "We enable businesses to demonstrate openness and honesty across seven topics: community, environment, finance and governance, human rights, marketplace ethics, workforce and lastly ‘ethical choices’, a hotchpotch of issues which defy categorisation under the other six, more defined topic areas. We create questions which test businesses on 48 separate issues under these seven topic areas. Each question is accompanied by a scorecard which seeks to define POOR, OKAY, GOOD and EXCELLENT policy and practice on the issue under examination."

The questions and scorecards are developed openly and collaboratively with businesses, investors and civil society groups. On a monthly basis R100 holds round-tables to discuss the latest question and scorecard, or to re-examine, update and improve those previously published. In the past month R100 worked on tax transparency with Legal & General, SABMiller, Huawei, Balfour Beatty Investments, Kepler Cheuvreux, Oxfam, ActionAid, Christian Aid, ShareAction, and Fair Tax Mark, amongst others.

On 29 June, the latest topic for review is  "Board Effectiveness."  According to Solomon, corporate governance experts from the auditing profession have agreed to offer their views in shaping this new question. The first full draft will be sent out to businesses willing to participate by 10 June.

Solomon is keen to hear from the widest range of possible view points: "I will be happily sharing the results of our efforts to provide a good answer to this question. Indeed, I am extending an open invitation to anyone inside business, or any expert outside of business, who would like to help with the work that we are doing."

The sign-up form for the 29 June event is now online   http://goo.gl/forms/4IugKVdzrp

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