What are #Governance ratings missing? “Company #culture, sub-board management, alignment with strategy, track record on target delivery and the positives from long-term ownership are all underappreciated when it comes to the criteria used to rate the “G” in “ESG”. Code compliance is a poor proxy for good or bad practice in these areas”
What does the gap between a group’s policy and practice say about its culture?
Is sub-board level management taken into account when scoring governance?
Are the minority risks often associated with family ownership offset by governance positives?
How is the governance of cyber risk assessed?
Culture – How quickly did the company release bad news? Was the impact estimated? Was the market kept updated? How soon was the impact quantified?
Timeliness – Governance is dynamic, and changes are not tied to the annual reporting schedule. How current is the governance view that informs your rating?
Tenure - Has leadership been there long enough to demonstrate performance across business cycles?
Strategy – Are board changes aligned with strategy or is Code compliance the driver?
Good questions and thinking from Paul Marsland (Kepler) in his latest #ESG report: What are #Governance ratings missing? Can link you up if interested.