Spreading integrity

FOR a governance advocacy, the concern for sustainability of a good governance program is best addressed by promoting integrity. This calls for total consistency between actions and principles, between decisions and professed ideals. This call is addressed to every institution that aims at continuing high levels of performance, sustained over a long period of time.

For ICD and ISA, however, integrity comes with the governance package of: fairness towards others; courage in facing up to external odds and difficulties; and discipline in facing up to the difficulties that well up from internal sources. These are the basic elements of a governance culture that need to be embedded at the inner core of an institution and of every individual within that institution.

When the “integrity initiative” was launched and promoted by other groups, with support from corporations that had been burned by past apparent failure to observe a proper governance culture, ICD and ISA were among the first signatories. They immediately committed to be part of the movement spreading such an initiative ( the “integrity initiative”).

But beyond signing on to the integrity pledge, ICD and ISA have always looked at the sustainability challenge as requiring a more comprehensive response. This would cover at least the following:

• Ethics. This is a call to go beyond what is merely legal and give due importance to what is moral. All too often, the standards of the latter are higher, more demanding, and more “ideal” than the basic, minimum requirements of human positive law. Governance helps push institutions and individuals to submit to the higher standards of ethics.

• Creating shared value. All institutions ( and individuals) are committed to add value; they need to contribute to the broader value that society and the community require. In formulating their basic value proposition, and therefore in building up their business model, they need to look around with diligence for: the gaps they can help fill; the kinks in the economic value chain they can help iron out; and the holes in the system that render inter- connections and mutual reinforcement mechanisms to be weak, ineffective, or even non- functional that they can help cover. In the process, particularly for profit- making institutions, they should be able to make money and generate a net positive income commensurate with the risks of the investments they had sunk in. But focus should not be only on the profit they can make; it should include the net value they can help create for the economy and society as a whole.

• Social responsibility. Institutions and individuals live not by bread alone; they also live and prosper by the social relations they strike up, and by the positive contributions they are able to put in, such that they effectively favour the common good of all in as many facets of life as possible. They should always bear in mind that in addition to the economic and financial facets, there are equally important non- economic and non- financial facets: these may be no any less critical to the common good of all.

As governance advocacies, ICD and ISA need to be duly observant of a proper governance culture, centered on integrity and reinforced by fairness, courage, and discipline. Moreover, they also have to be duly compliant with all laws and regulations, even as they submit to the higher demands of ethics, shared value, and social responsibility. They share the conviction – and spread it with zeal and refinement – that sustainability of any governance program is secured not by gover- nance practices alone as well as compliance to regulatory issuances. It has to be secured also by a proper governance culture and the infusion of ethics, shared value, and social responsibility into their “business models.”

Any governance advocacy has to start applying all these “strategic guidelines for sustainability” to its own strategy formulation and execution. It should also be pro- active in spreading the inculcation of these guidelines in other institutions, including the individuals who work in them.