In an Era of Heightened Transparency, Boards Must Bolster Compliance

Stakeholder capitalism in the ESG era may drive heightened expectations as well as regulations for reporting, transparency, and accountability—plus greater pain for those who fail to achieve needed levels of compliance. Boards should take a proactive approach to ESG and similar stakeholder capitalism, ensuring sufficient resources, appropriate controls, and focused communications.

Compensation strategies are facing greater scrutiny, not only as a social issue (the S in ESG) but also as companies in many different industries struggle with a labor shortage. A 2021 Pearl Meyer survey of companies found nearly half of respondents (47 percent) had experienced higher than usual employee turnover rates.