Sabga: Companies need good corporate governance - BATCE …



Business Ethics and Corporate Social ResponsibilityThere is growing importance of business ethics, integrity, code of ethics, obligation, good corporate governance and corporate social responsibility in setting business objectives in the business world today. Sabga: Companies need good corporate governanceSunday, November 25, 2012Andrew SabgaAndrew Sabga, president of the T&T Chamber of Industry and Commerce, says Government must devise proper policies to ensure good governance practices among businesses in T&T. But he did not rule out the role of the private sector, including the Chamber, in protecting the reputation of the industry in light of the collapse and CL Financial and Hindu Credit Union.The ongoing commission of enquiry in this financial debacle is revealing numerous cases of management inefficiencies and in some cases greed which led to the failure of the companies, causing the State to inject $20 billion CL Financial in an effort to save the investment of depositors.Sabga was speaking at Tuesday’s gala awards ceremony at the Hilton Trinidad, hosted by the Ministry of Trade, Industry and Investment, to celebrate the 60 companies that re-invented themselves to become modern-day symbols of excellence.Sabga said, “One cannot underestimate the importance of good corporate governance, which is the foundation for sustainable business. We must now look at formalising the process, through proper government directive and further private-sector partnership with the public sector, to continue the efforts of economic diversity in T&T.”He added, “As we look back through the past 50 years, we see that those companies which continue to succeed today have placed emphasis on strong corporate governance and have made their core values and even our nation’s watchwords—Discipline, Production and Tolerance—the backbone of their companies’ policies and procedures.We need to ensure, as business practitioners, that we all make a commitment to good corporate governance and incorporate ethical behaviour in our business strategy, operations and culture, so that those who succeed us can stand proud and carry on the great legacy, we have created.”Sabga called for more companies to embrace the concept of corporate social responsibility. For those already on board, he urged them to go beyond mere obligation as required by the law and show a genuine concern, not only for the environment, but for the nation. Doing business in an ethical way was in the interest of the wider community, he said, and companies must continue to find ways to give back to the people of T&T, who have been good to them.He said: “Fifty years ago, in 1962, the way business was conducted was vastly different from what it is today. In the past half-century, advances in technology have drastically improved the way we all conduct business. Business processes have changed and made organisation more efficient.“At the same time, technology has opened lines of communication, allowing businesses to communicate and collaborate beyond borders with ease. “Collaboration is the future of the business competitiveness as companies become more innovative, connect to people better and overall act faster in the ‘flattened’ marketplace of today’s global, economy,” he said.What is 'Business Ethics'? The study of proper business policies and practices regarding potentially controversial issues, such as corporate governance, insider trading, bribery, discrimination, corporate social responsibility and fiduciary responsibilities. Business ethics are often guided by law, while other times provide a basic framework that businesses may choose to follow in order to gain public acceptance.Integrity in BusinessIn the rush to start a business, keep it running and make money, there’s one important detail that can get lost in the hullabaloo: integrity. Integrity isn’t something easily monetized, but when it’s implemented into a business’s DNA, there is plenty of money to save and the great potential to make more.It’s easy to overlook the quality of integrity when running a business, but incorporating it into all of your business dealings and decisions can advance your company to greater levels of success.Integrity is synonymous with trust in the business world. After all, clients have to trust the people they do business with to keep them, so owning up to every responsibility is paramount.The bottom line is consistency. A company needs to maintain what it says it does, and who it says it is. There shouldn't be an external impression of the business that is dramatically different from the internal version.Especially in rough economic times, to be someone the buying public can trust is priceless. So while it might not seem immediately top on your list, your business can't afford to compromise its integrity in this competitive market. "When people choose to lead with integrity they position themselves at the top of their industry," says Lisa Krohn, a personal organizer and life coach who works to bring the concept of integrity back into businesses. "All the other details, like the product, or service, or whatever, come after integrity because people do business with people they know, like, and trust."What are Ethical codes? These are adopted by organizations to assist members in understanding the difference between 'right' and 'wrong' and in applying that understanding to their decisions. An ethical code generally implies documents at three levels: codes of business ethics, codes of conduct for employees, and codes of professional practice.A code of ethics will start by setting out the values that underpin the code and will describe a company's obligation to its stakeholders. The code is publicly available and addressed to anyone with an interest in the company's activities and the way it does business. It will include details of how the company plans to implement its values and vision, as well as guidance to staff on ethical standards and how to achieve them. What is good corporate governance? The framework of rules and practices by which a board of directors ensures accountability, fairness, and transparency in a company's relationship with its all stakeholders (financiers, customers, management, employees, government, and the community).The corporate governance framework consists of (1) explicit and implicit contracts between the company and the stakeholders for distribution of responsibilities, rights, and rewards, (2) procedures for reconciling the sometimes conflicting interests of stakeholders in accordance with their duties, privileges, and roles, and (3) procedures for proper supervision, control, and information-flows to serve as a system of checks-and-balances. What is 'Corporate Social Responsibility'? The term "corporate social responsibility" came into common use in the late 1960s and early 1970s after many multinational corporations formed the term stakeholder, meaning those on whom an organization's activities have an impact. CSR refers to corporate initiatives to assess and take responsibility for the company's effects on the environment and impact on social welfare. The term generally applies to company efforts that go beyond what may be required by regulators or environmental protection groups. Corporate social responsibility may also be referred to as "corporate citizenship" and can involve incurring short-term costs that do not provide an immediate financial benefit to the company, but instead promote positive social and environmental change. ................
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