Ethical leadership and corporate citizenship

The leadership of an organisation, including its directors, boards and committees, will have to review the corporate values that drive their behaviour to ensure that they and the organisation reflect societal norms and accepted governance guidelines. To this end, leaders are expected to support and understand the full implications of the stakeholder inclusive model put forward in the previous King reports and again emphasised in King III.

Leaders will also have to give due consideration to the full range of material economic, social and environmental dimensions and impacts that the company and its processes have on the community in which it operates, when developing corporate strategy.

Entities cannot operate in a vacuum. A licence to operate afforded by a multitude of stakeholders is based on trust, integrity and a solid track record of taking into account a balanced approach to legitimate stakeholder issues.

Corporate citizenship is an ethical concept, which finds expression in sustainable development across the economic, social and environmental aspects of the business.

1. Corporate citizenship, sustainability and stakeholder inclusivity requires judgement, balance and compromise. Does the board have the right composition, skills and reliable data to make these types of judgement calls?
2. Have we assessed the moral and economic imperatives of corporate citizenship? Have we taken this into account when reviewing our corporate strategy?
3. Citizenship and sustainability risks may be obscure or indirect. How do we identify and manage these risks as well as opportunities?
4. Do we have policies in place that will guide every level of the business in terms of expected behaviours and practices and with reference to our interaction with all material stakeholders?
5. Do we measure the impact or lack thereof, of our corporate citizenship initiatives?