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The term governance refers to procedures and methods used to decide and regulate factors affecting common interests. Having a governance policy in place can help to align all areas of your business and ensure everyone in the organisation knows the procedures they need to follow in their role.
It can also help to define and communicate the corporate identity of your company, helping to ensure compliance with anti-bribery and corruption laws, provide a sustainable position for all stakeholders, ensure safe working conditions for your workforce, promote ethical recruitment, and more.
As such, planning your governance policy shouldn't be taken lightly. While developing our 2021 ESG Report, we identified five key factors to consider when planning governance policy, including:
Business ethics
As a company, you have a moral and often legal obligation to your employees, the organisations you interact with, and the environment to operate in the best interests of these groups.
However, we believe that the legal requirements of ethical operations is the minimum that businesses should be working towards. This is where your Code of Business Ethics can be instrumental in supporting your employees and protecting your business. It provides a useful resource for your employees to reference whenever they are unsure how to react to specific situations.
For example, your Code of Business Ethics can clearly define how to avoid conflicts of interests, enable transparency in financial transactions, ensure the fair treatment of all your colleagues, and much more.
It also significantly reduces the risk of legal action against your business, helps to maintain your reputation, and builds stakeholder trust. Of course, there is a need to ensure everybody in your organisation upholds these policies.
A successful way to do this is to periodically send out a Statement of Commitment to this code to both your employees and business partners, while instilling accountability at board level.
IT security and data protection
IT security and data protection is another crucial part of governance policy. Data breach costs rose to $4.24 million last year, indicating the importance of clearly defined procedures for your business and the need to be compliant with the rules and regulations surrounding IT security in your areas of operation.
This is a particularly complex area which is always evolving. Once you have all the relevant policies in place, cyber security training for staff is an excellent way to build your employees’ knowledge in this area. This will help you to minimise potential exposure to cyber fraud, malware and data privacy breaches.
Quality management
A well-defined quality policy is instrumental in ensuring both customer and business needs are met. You can establish consistent quality control across you business by:
- Implementing a consistent quality management system
- Securing relevant accreditations for the business
- Gaining feedback from employees, customers and contractors
- Regularly reporting on quality metrics, objectives and performance
- Audit, review and develop objectives over time
Regular monitoring can help you identify where your organisation is falling short of its goals and make it easier for you to correct the situation. Customer and company needs also evolve over time, and consequently, the quality metrics should as well.
Human rights
Human rights and governance are intrinsically linked and it is essential that organisations respect and uphold the rights of all people.
This should be evident across all areas of your business. From ethical recruitment and ensuring safe working environments, to non-discrimination, avoiding modern slavery, and human trafficking in supply chains.
At Airswift, we have aligned our Human Rights Policy with key UN Sustainable Development Goals, guided by internationally recognised human rights principles. Developing governance in line with these principles clearly communicates an understanding and a commitment to working to high ethical standards and doing more than simply meeting the legal requirement.
Anti-Bribery and Corruption (ABC)
Lastly, a good governance policy should have clear guidelines on anti-bribery and corruption, including the consequences of each.
You can implement measures to encourage and empower staff and other individuals you interact with to report issues they encounter. For example, allowing for anonymous disclosure can help employees feel more secure when they make a report. Especially if it involves a senior stakeholder or a colleague that they work closely with.
Furthermore, providing training in these areas can help to embed and enforce these policies in your workforce. This is an action we have taken at Airswift; Providing 91% of our employees with anti-bribery and corruption training in 2021.
Final thoughts
While it is important, governance is only one third of the environmental, social, and governance (ESG) planning used to ensure companies operate in an ethical and sustainable way. Additionally, investors are increasingly paying attention to all three facets of ESG, highlighting the need to evaluate each for your business.
It is also important to note that this is an ongoing and evolving process. It must be monitored and adapted over time to respond to both internal and external changes. To assist you in ESG planning for your organisation, our 2021 ESG report provides more insight on our policies, initiatives and commitments and can be used to inform the structure of your report.
