Speaking recently on The Corporate Counsel Show, Greenpeace Australia general counsel Katrina Bullock said convincing the powers that be of the importance of such an approach was critical.
“We’re coming into a time where investors are willing to invest or divest based on the sort of SRI, or the social governance aspects of reporting. We’re coming to a time where consumers are willing to boycott or purchase based on what a company’s doing, whether it be in relation to the environment, in relation to their supply chain, and child labor,” she explained.
“These issues are not discreet. So often they’re thought of that way, but yeah. It all intertwines, and you need to look at sustainability in absolutely everything you are doing. You need to put the environment and other ethical issues at the centre of your decision-making every time you are looking to do something as an organisation. That’s something that I think boards of directors are really coming around to.”
There must be a recognition, Ms Bullock ceded, that big corporations need to do what is best for shareholders, which makes sense, she said, in a common law context of corporations law.
“[But] there’s this increasing awareness that, in order to do what’s best by your shareholders, you also have to look at the community. You have to look at your social licence to operate,” she said.
“There’s actually a lot of board directors out there who want to make great decisions that are good for the environment, but they don'’t feel like they necessarily can, because they think they have to pursue profits at the exclusion of all else based on the way our current corporations law is structured.
“There’s a lot of talk in this space about having an environmental judgment rule, kind of like the business judgment rule, where if they’ve done enough due diligence, and if they know that this is something that could really enhance the organisation and the community they’re working in, they’re able to make that decision without potentially suffering any kind of legal ramifications in terms of director’s duties.”
It’s a space that is continuously evolving, Ms Bullock mused.
“We’ve had some terrific [progress], but I think there’s still a long way to go there.”
To listen to Jerome’s full conversation with Katrina, click below: