Companies can no longer expect to engage in dubious or unethical corporate behaviour without risking their reputation and damaging, perhaps irrevocably, their market position. Irresponsible corporate behavior not only deprives shareholders of long-term returns but also ultimately imposes a cost on society as a whole. Sustainable business is about ensuring that entities contribute toward positive social, environmental, and economic outcomes. Bad business behaviour is costly for stakeholders, for markets, for society, and the economy alike.
To ensure that a company behaves well, the buy-in of the leadership team is crucial. The full commitment of the board of directors, in conjunction with the senior managers of the organization, is required if an organization is to be socially responsible. In this sense, leadership does not reside with an individual (the CEO) within the organization but with all of those at the apex of corporate power and control. Effective change management requires enlightened and capable leadership to instigate and drive the process of embedding a sustainable and socially responsible corporate philosophy and culture that supports good business decision-making. A profound understanding of the requirements of such a leadership process will help corporate managers become highly effective change agents.
Governance will be the main driver of this change. For the economy and financial markets to become sustainable and resilient, radical changes in corporate leadership need to take place. Integrated reporting, government regulation, and international standards will all be important factors in bringing about this change.
As well as understanding the effects of corporate behavior on financial markets, such an understanding is also now imperative in relation to the social and environmental contexts.
Table of Contents
Part I: Market Behaviour, Stakeholders’ Approach and Good Governance
1. Agency Theory: Explaining or Creating Problems? Good Governance and Ethical Behaviour for Sustainable Business
2. Using a Stakeholder Approach to Understand Success: Empirical Tests in Indian Businesses
3. Behavior in Academe: An Investigation into the Sustainability of Mainstream Scholarship in Management Studies
Part II: Effective Business Behaviour for Corporate Sustainability
4. The Walls Between Us: Governance for Sustainability
5. Governing Corporate Responsibility: The Role of Soft Regulation
6. Corporate Citizenship, Ethics and Accountability: The Significance of the Process of Trust for Corporate Legitimacy in Late Modernity
Part III: Monitoring and Reporting on Sustainability
7. Positioning of Corporate Social Responsibility in Media Reporting: The Role of Media Setting
8. A Pathway to Corporate Sustainability – Social Accounting
9. ESG Matters and the Boardroom
Part IV: The Requirements for Implementation of Sustainability
10. The Drivers of Change
11. From Ego-to Eco – Theoretical Challenges and Practical Implications of a "Next Generation": Responsible Leadership as a Collaborative Endeavor
12. Valuing Corporate Governance
13. Defining and Achieving Good Governance
Güler Aras is a professor of Finance at Yildiz Technical University, Istanbul, Turkey, and a Visiting Professor at Georgetown University McDonough School of Business. She is the founding director of The Center for Finance, Governance and Sustainability (CFGS) at YTU. She is the former Dean of the Faculty of Administrative and Economic Sciences and the Graduate School.
Coral Ingley is Associate Professor of Management in the Faculty of Business and Law at the Auckland University of Technology, Auckland, New Zealand. In 2006 she founded and is Director of the Centre for Corporate Governance at the university and is a member of the Faculty’s Work Research Institute. She has served as a visiting professor at Sorbonne University, Paris, ESC-Troyes, France, Maastricht University, The Netherlands, and Toulouse Business School, Barcelona, Spain. Her research focus is on corporate governance.