GLOBALLY, stakeholder capitalism, which is the idea that businesses have a responsibility that extends beyond their shareholders, has gathered significant momentum in the last few years. Consequently, boards and management have been prompted to rethink the role of their organisations in terms of who they are serving, what contributions they can make to society, and what constitutes long-term value.

More traditional strategies that narrowly focus on financial output have become increasingly risky. Long-term value is not just about immediate financial returns. It’s asking what will drive – or destroy – value for the business in the next era. Organisations will need to look at value from three pillars, namely customer value, including customer satisfaction, trust and loyalty; people value, comprising engagement, employee loyalty, diversity and inclusiveness, health and wellness; and thirdly, societal value, encompassing sustainability, total economic impact, carbon footprint and ethics.

With the increasing emphasis on long-term value, at the heart of corporate governance must be a strong focus on ethical, responsible and sustainable decision-making. In other words, governance for good.