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Why Boards Need to Change

September 18, 2012 | Edward E. Lawler III, Christopher G. Worley | Strategy
Sustainability is an increasingly important business issue. In response, many companies have initiated sustainability and corporate social responsibility programs that represent good first steps toward improving the impact of their organizations on the environment and society. However, unless boards change, many of the initial sustainability efforts launched in corporations are likely to be temporary. For organizations to achieve sustainable effectiveness, they need a corporate board that is designed to lead in a sustainably effective way. This means that boards need to change their way of operating so that they are focused on the integration of social, financial and environmental performance--just as they expect the rest of the organization to be.

The authors explore examples of companies who have successfully created boards who look at the triple-bottom line performance, measuring not only profits and financial accountability, but also the company's impact on society and the environment. The authors outline the changes that need to be made for a corporate board to take on the more complex decision-making that involves not only financial performance but social and environmental performance as well.
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