I had the great joy of an hourlong meeting with Professor Mervyn King, an elder in our South African business community, and a giant in global governance and sustainability. It was to be an hour that I will not forget, and will forever guide my considerations in business leadership, mentoring and economic development discussions.
Having already shared some emails between ourselves speaking about our passions, work and interests, our meeting started at a fast pace. In terms of background, our work at DRG and BusinessFit has been in creating a business framework for organisations to use in assessing their organisational sustainability from Environmental, Social, and Governance (ESG) perspectives. These are contributions to the development of communities and society as a whole, supporting the respectful use of raw materials and replenishment of the environment’s natural resources, and following a governance framework of ethics and effectiveness to improve businesses contribution to the creation of a sustainable economy.
The BusinessFit business assurance process considers four critical perspectives evident in every business, namely:
· Leadership, ethics, and value creation
· Functional area foundation and quality assurance and controls
· Defined outcome intentions and stakeholder measurements
· Organisational culture effectiveness and staffing engagement levels
The BusinessFit business assurance and business leader mentoring process draws together aspects from the King IV governance framework, as the foundation to a leader’s and the governing body’s organisational roles and responsibilities. These focus areas aim to help ensure an ethical and effective work intention and staffing culture, community value creation and organisational productivity, suitable operational and system support applications, quality assurance, risk management and adequate controls, strategy development and implementation, business minded linkages and considerations, and a foundation of trust and legitimacy.
Each business, as we know well, has its own uniqueness, and the BusinessFit model’s intention is to help identify and encourage those areas where entrepreneurs and business leaders excel, and to assist in areas where support and development is desperately needed.
Having recognised that a framework detailing key focus areas is hugely supportive from a mentoring perspective, my first question to Professor King was to ask him the reason he may have considered why the economy had not adopted a stated business framework of reporting that encouraged business leaders to be aligned in meeting corporate governance principles and practices, which in turn meet organisational expectation and stakeholder outcomes intentions.
The motivation of the BusinessFit framework is to improve business success in the open market, and the effect of course is well structured and well-managed businesses having a reduction in wasted resources, adding commodity value to communities, providing confidence in success expectation, and creating sustainable employment.
Considering that Professor King has an unrivalled background in law, business, leadership, integrated reporting, and is known the world over as a leading resource and authority in sustainability measures and corporate governance frameworks, there is no one better in my opinion to respond to this important question and consideration. Professor King wasted no time in responding, and agreed that a common framework supporting activities and strategies to drive businesses towards meeting pre-defined outcomes is important in improving success rates of organisations in the markets – no matter how young or mature the businesses are in the economy. He explained that there was, however, a further more critical consideration, which is ethical and effective leadership from the governing body, and assurance that the organisation is free from influencers such as corruption, greed, and the like.
Professor King emphasised that some of the greatest minds on earth had been drawn together over the past decades to focus on models to support ESG initiatives, integrated reporting, and the development of manageable governance frameworks. He continued by saying that although many of these fine minds brought together for this purpose of improving business effective considerations had different backgrounds and perspectives on organisational success, each had a valuable contribution to make in defining supportive business frameworks to result in more businesses being successful in the market. However, what the business frameworks do not include is human capital, except for the integrated reporting framework. Conscious corporate leadership as the collective mind of a board is the important factor.
Professor King continued by saying, “One hopes that mankind does one day reach that point of evolution where in a mature and caring fashion is able to share knowledge and kindness to others that seek to establish their value creating pursuits in the economy for the betterment of communities, society, the environment, and the world at large.” Professor King went on to say that the King Committee had recognised that the best frameworks ever conceptualised needed to start with the concept that the organisation was incapacitated, and its corporate leaders were the heart, mind, soul and conscience of the company.
Great value is given to organisations that meet legislative requirements and operate efficiently, as well as ensure value creation and process effectiveness. To support the aim of encouraging leaders and governing bodies to adopt ethical practices, the term Responsible Corporate Citizenship was created.
Responsible corporate citizenship is recognition by an organisation, no matter its incorporation, that it has legal, social, cultural and environmental responsibilities. Being a responsible corporate citizen means being guided by moral and ethical standards in daily interactions with customers, stakeholders, and employees. Responsible corporate citizens value, monitor and beneficially affect communities and societies at large, and do not absorb more raw materials from the environment than can be replaced by nature herself in a reasonable period of time – and in a constructive manner. Responsible corporate citizenship strengthens employee engagement and commitment, raises staffing energy levels, and enhances purpose and contribution from individuals and teams within the organisation.
I was not amazed by Professor King’s focus on leadership and culture as being critical in organisational success. However, I had not up to this point considered that ethical and effective leadership and meeting responsible corporate citizenship expectations was in fact more critical than providing a governance framework to guide business leaders and governing bodies towards achieving success and prosperity. The realisation of Professor King’s focus and contribution became obvious right away, as it is relatively easy for business leaders and organisational teams to follow processes to reach milestones and goals; whereas when they are empowered to make collective decisions, they do at times become subjective, and choose outcomes that positively affect their individual prosperity and hierarchal endeavours, rather that recognising their true responsibility as leaders and governing bodies for the long term best interests of the health of the organisation.
As I sit at my desk now, I realise how much I have learnt from the great Professor King, and that all the good intentions we have infused into a guiding business framework and ecosystem to support successful outcomes of entrepreneurial and business outcomes is affected positively or negatively by the simple process of thinking, considerations, and actions adopted by business leaders.
It is clear that maturity in the business leaders and governing bodies who recognise their role in society as critical in creating engaged work environments that include community, environmental, social, and governance considerations are the guiding lights needed to help improve our collective and economic challenges.