The topic of corporate governance and ISO standards is increasingly in vogue in the market. This is because the importance of maintaining rules, procedures, and organizational standards is ever more significant given market changes and the needs of each sector.
Moreover, the relationship between corporate governance and ISO standards is very advantageous both for companies and the professionals involved in the implementation and maintenance of these standards. This is because the standards represent valuable tools that help keep governance up-to-date, as well as implement whatever is necessary.
For this reason, in today’s article, we will delve into the importance of governance and which standards we can use to support this critical aspect for business growth and evolution.
What is Corporate Governance?
First and foremost, it’s always essential to remember what corporate governance is. According to the literature, we can define this term as: “a set of practices and principles aimed at ensuring transparency, responsibility, and sustainability of companies.”
The primary goal of governance is to balance the interests of various stakeholders involved. As stakeholders, we can cite shareholders, directors, managers, employees, clients, suppliers, the community, and any entity impacted by or impacting our businesses.
All this effort serves to help ensure that our organizations are managed as effectively, fairly, transparently, and responsibly as possible!
Understanding this basic notion about governance is paramount for our discussion today.
ISO Standards that Support Corporate Governance
In its structure, corporate governance includes the whole set of procedures, processes, and practices aimed at meeting the standards set by organizations. But to support the implementation of effective and efficient governance, we can use a series of management tools available in the market.
Among these tools, we can mention ISO management system standards. Given the importance of this topic, since 2014, ISO (International Organization for Standardization) has had a technical committee dedicated to drafting collaborative governance standards.
This technical committee is ISO TC 309, a committee I proudly belong to. In it, I and other members focus on creating rules and standards that assist businesses in implementing corporate management. Established since 2014, this committee has many materials that are globally referenced. This committee also provides the primary references mentioned in this article.
ISO 37000 – Governance of Organizations – Guidance
According to the ISO website’s text, ISO 37000 “provides principles and key aspects of practices to guide governing bodies and governance groups on how to fulfill their responsibilities so the organizations they govern can achieve their purpose.”
It is applicable to any organization, regardless of size, and acts as a true governance guide. It’s used by thousands of organizations as a step-by-step guide, a “recipe”, on how to implement corporate governance.
It’s worth noting that this isn’t a certifiable standard, but it is an essential tool for any business.
ISO 37001 – Anti-bribery Management Systems — Requirements with Guidance for Use
In this standard, as the name suggests, we address the implementation of a management system to prevent, detect, and respond to bribery. If the organization wishes, the scope can be broadened to address corruption in general.
This standard supports governance by establishing principles, guidelines, and controls for situations involving bribery and corruption. This is essential due to the high risks such situations can pose to businesses, as well as the negative impacts these practices can have on the company’s results and image.
ISO 37301 – Compliance Management Systems — Requirements with Guidance for Use
This standard provides guidance on implementing compliance management systems. It outlines principles and guidelines for organizations to address their main compliance obligations.
It’s essential to understand that both ISO 37001 and ISO 37301 are certifiable standards, meaning they can undergo compliance verification and external auditing. Thus, it’s possible to implement their guidelines and obtain a compliance and anti-corruption certification, increasing respectability in the market and improving the organization’s image.
ISO 26000 – Social Responsibility
This standard addresses aspects and guidelines of social responsibility and sustainable development.
It contains various principles ranging from occupational safety and health, risks of slave-like labor conditions, to aspects of corporate governance that can be implemented in businesses.
Due to its breadth and relevance, ISO 26000 is an exciting tool and can be used to further support corporate governance.
ISO 31000 – Risk Management Systems
The last tool I introduce concerning the relationship between corporate governance and ISO standards is the renowned ISO 31000. Through this standard, it’s possible to establish a complete risk management framework, identifying, reacting to, and addressing incidences.
This standard significantly supports governance because of its scope within a company and can be applied to all organizational aspects. For example, it’s beneficial to map out risks related to corporate governance.
Corporate Governance and ISO Standards – A Partnership Leading to Results
Corporate governance is an essential topic for current management. Given the challenges and market competitiveness, it’s a key requirement to achieve better results, remain sustainable, and ensure more responsibility and ethics in business.
In today’s article, I’ve only touched on 5 standards you can use to implement and support your company’s corporate governance. However, it’s worth noting that there are dozens of other tools available, and it’s beneficial to delve deeper into this topic.