Corporate governance in recent years has evolved to encompass topics that go beyond notions of agency conflict. Corporate governance has now become a tool for responding to current societal challenges, particularly environmental and social issues.
If in the past, unlisted companies could exempt themselves from the legal rules of governance, it was always recommended to keep them in mind and apply the basic principles. Today, unlisted companies that wish to demonstrate legitimacy have even more need to embrace modern corporate governance, driven by the rapidly changing expectations of wider society. That is why ecoDa has decided that now is an appropriate moment to update its landmark guide to private company governance.
A European Working Group made up of representatives of our national institutes (listed below) was mandated by ecoDa’s board to carry out this exercise. The Institute of Directors in the UK played a key role in updating this publication with the collaboration of the Instituto de Consejeros-Administradores in Spain – as in the 2010 version. This updated 2021 edition maintains its non-binding nature as well as a phased approach so that each type of company can tailor the recommendations of the report to its own needs and national circumstances. But it now provides a more modern treatment of the role that ESG issues – particularly climate change – should play in the governance of all kinds of enterprise.
In this new edition a voluntary corporate governance self-evaluation tool is provided in order that users can measure periodically the degree of application of the voluntary corporate governance principles as well as define plans for the future.