Corporate Stewardship vs. Management - Troy T. Taylor
Stewardship is the careful and responsible leadership of something entrusted to one’s care, while management is solely the act or skill of controlling and making decisions. As Corporations strive to improve their ESG performance, a reevaluation of their top responsibility as boards and managers is worth considering. The priority of maximizing shareholder’s wealth may be better served by focusing on maximizing company’s health.
There are multiple constituencies that are served by and contribute to the long-term sustainability of our corporate entities. To name a few:
Customers expect that our products and services will meet their needs and that this is accomplished with high quality at a reasonable cost.
Suppliers and business partners that must have the opportunity to make a fair profit.
There are also employees who deserve an inclusive environment, to be treated with respect, have a sense of security, compensated fairly, provided with a safe and clean work place, respected for their diversity, and provided equal opportunity for advancement.
The communities in which we live and work expect us to be good neighbors, respect the environment, and contribute to the wellbeing of the community
Our shareholders and investors expect us to make a sound profit, invest for the future, create innovative products and services, be transparent in how we operate, reserve for adverse time, and provide a fair return to shareholders.
You don’t have to make a tradeoff between our capitalist ideal and social responsibility. The Error at the Heart of Corporate Leadership by Joseph L Bower and Lynn S. Paine is a must read by every corporate leader.
