Governance 2

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Foreword

We are at a turning point in the sustainability and To help guide companies on the next evolution in
environmental, social and governance (ESG) agenda. governance, EY teams has conducted this second
edition of its Long-Term Value and Corporate Governance
From the outside-in, we have now reached a stage
Survey, building on our inaugural research in 2021.1
where investors, regulators, policy-makers, employees,
Drawing on insights from a survey of 200 corporate
consumers and the public as a whole simply expect
directors and senior managers from leading European
a company, its management team and board to be
companies — as well as in-depth interviews with
actively addressing ESG priorities and opportunities.
business leaders, academics and other experts in this
The relationship between a company and its employees
field, including EY own subject matter professionals —
and stakeholders is being redefined by the sustainability
we examine three areas:
agenda, and their voices need to be heard.
• How companies and boards are putting ESG at the
From within the organization, executives are passionate
heart of their strategy to build risk resilience while
about making a difference to planet and people, and
also driving new growth opportunities
building their companies’ resilience, growth prospects
and long-term value. In fact, as well as a route to greater • Why success means addressing major external and
internal challenges, including economic uncertainty
risk resilience in the face of increasing disruption, this
and the need to establish a clear ESG mandate for
research shows that executives today believe that ESG is,
the board
above all, a major commercial and growth opportunity.
For leading companies, it will be a route to innovation • Three priorities for strengthening the governance
across products, services and even business models, system to support strategic decision-making on ESG
allowing them to shape the future of their industries and long-term sustainable growth: the right board
operating model, composition and skills; innovative
and stay a step ahead of disruption. By deploying an
approaches to reward and remuneration; and
ambitious long-term value approach that proactively
effective ESG reporting and investor engagement
addresses ESG factors, a company can outpace its
competitors, improve profitability and unlock new We look forward to collaborating with CEOs and boards
sources of value creation. on this critical topic, and our thanks go to the corporate
leaders and experts who contributed their thinking to
Robust corporate governance and a central role for
this discussion paper.
boards are critical for getting on the front foot with ESG
and achieving the cultural and mindset change needed
to drive a sustainability transformation. For executive
teams to be proactive and build a winning position while
dealing with competing priorities, they need a board
that is empowered and has the operating model, data
and capabilities it needs to provide strong direction,
challenge and support. Without the right governance,
there is a danger that a company’s ESG approach could
Julie Linn Teigland Andrew Hobbs
be ineffective, fragmented and reactive. EY EMEIA Area EY EMEIA Public
Managing Partner Policy leader

¹ “Will there be a ‘next’ if corporate governance is focused on the ‘now’?”,


EY Long-Term Value and Corporate Governance Survey, March 2021.

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