For many years, directors have paid attention primarily – exclusively? – to delivering a return to shareholders.
Many businesses have been driven by short term profits. Rather than consider societal benefits, and sustainability, some directors have been shielded by their statutory duty to act in the best interests of the company.
This might all be about to change, in Aotearoa New Zealand. And the sword is being waved by Labour MP Duncan Webb. He’s challenging the status quo by pushing new laws which will enable directors to consider wider issues – like Te Tiriti obligations, social outcomes and environmental impact – when they make decisions. This is groundbreaking for board rooms – or it will be when it becomes the law. It can’t come soon enough.
To be fair, many businesses already consider sustainability issues in their strategies, and leading companies go further, ensuring that their very purpose is to do good for our people and planet, rather than only make a profit. But it is great to know that soon the law might just be on their side, providing a positive environment for good stuff to happen.