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Operational Resilience and esG

Author: Chris Goodeve-Ballard

The Apostrophe Protection Society is a laudable body of individuals. They have a clear aim, they are fanatical about their subject, there are well known rules and they have a massive (if sadly hopeless) task ahead of them. For the record, I am in wholehearted support of them.

ESG on the other hand, I find somewhat more troublesome – and I’m just thinking of the “G” aspect alone. ESG stands for Environmental, Social and Governance investing and refers to a set of standards for a company’s behaviour used by socially conscious investors to screen potential investments. Good governance is to my mind, an absolute pre-requisite. Certainly, from an ESG perspective, without excellent “G”, the “E” and the “S” will never happen.

During my research on the “G” in the context of ESG (Google is your friend), I discovered a lack of a consistent and straightforward explanation for its meaning. After extensive exploration of a variety of websites, I managed to distil the concept into several key components, including but not limited to:

  • A diverse Board (cognitive diversity rarely mentioned but vital)

  • Transparency

  • Separation of Chair from Executive

  • Staggered Board elections

There are many others but there is a real danger of putting ticks next to all of these and saying “Next”.

Excellent governance, however, stems from an effective Board.

An effective Board challenges and holds the Executive to account.

Unless working in a totally abstract manner, this means the Board must have regular, up-to-date, meaningful, and easy to digest information about the business. On top of that, the Board has a wide variety of things to discuss and decide in a relatively short period of time at each Board Meeting.

Operational Resilience is still in the middle of a transition period running until March 2025 and is just one of the variety of areas on which the Board must focus.

Aldbury International and CoBOS Technology have developed an Operational Resilience Self-Assessment Scorecard, that is simple to use, clear to understand and can be quickly updated for each Board Meeting. It gives the Board the relevant information on a single page showing progress in their Operational Resilience journey, as well as a marker against other firms covered by the same regulations. (Increasingly, firms outside the scope of the new rules are also following them as a simple matter of good practice).

Providing the Board with clear and pertinent information facilitates deeper discussions, encouraging more robust challenges, ultimately strengthening governance or the 'G' aspect of ESG.

This is as close as we can get to the positives enjoyed by the Apostrophe Protection Society and it will make life easier for Operations Teams and Boards.

If you would like to know more about our Operational Resilience Self-Assessment Scorecard or organise a free trial, click on this link or contact us on 020 3475 2953 for more information.


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