The Handbook of Board Governance, 2nd Edition

16Responsible Boards for a Sustainable Future:

Dr. Yilmaz Argüden

Founding Chairman of ARGE and Chairman of Rothschild

“Trust is the essence of good governance and the foundation of sustainable development.”

Introduction¹

As external pressures, including resource scarcity, globalization, and access to information continue to increase, how corporations respond to sustainability challenges will determine their long-term viability and competitiveness. According to the latest McKinsey Global Survey² on the topic, executives at all levels see an important business role for sustainability. The same survey results also show that aligning sustainability with core business strategy and stakeholders (like consumers, employees, investors) is the top reason for implementing sustainable business practices. Yet, there is significant room for improvement in the effectiveness of the execution and accountability of their sustainability programs.

As the world continues to get smaller, the mutual interdependence of the corporations and their stakeholders grows larger. To achieve success, institutions increasingly rely upon the utilization of not only their own resources, but also the resources of others. To be able to gain access to the resources of others, institutions need to create trustworthy relationships. Therefore, the key to success and development is gaining the trust of present and potential stakeholders. These stakeholders include not only shareholders, employees, labor organizations, ...