Leading corporate citizenship: governance, structure, systems

Abstract

Purpose: The purpose of this paper is to benchmark how 25 companies in five industries are addressing corporate citizenship through their governance, structures and systems. The paper aims to look at patterns of leadership practice developing in firms in this regard and what might be shaping them. It also seeks to consider current practices in light of movement toward next‐generation corporate citizenship.Design/methodology/approach: The study surveyed a representative sample of Fortune 500 companies. To benchmark how companies are embedding citizenship into their governance, structure, and systems, two scorecards were devised measuring practices pertaining to: Corporate Board Governance; and Operational Management of Corporate Citizenship. Criteria chosen represent Board and management policies, behaviors, and/or public commitments.Findings: It was found that, while corporate Boards are assuming more responsibility for oversight of conduct and taking account of specific social and environmental issues, citizenship is not yet fully embedded into Boards or the operating structures and systems of most firms.Research limitations/implications: Companies appear to be moving through developmental stages as they integrate citizenship into their governance and operations, with several developmental patterns emerging. While there seem to be specific patterns of development that link to the industry, issues faced, and culture of firms, it is difficult to generalize specific influences within industry from the relatively small sample. Further benchmarking is needed to better understand these issues and which ideas represent best practices going forward.Practical implications: A next generation approach to corporate citizenship requires more than top down advocacy – this needs to be backed up by Board oversight and engagement and by layered management structures, systems, processes, and policies that make citizenship part of every employee's remit, across the company's value chain.Originality/value: The paper provides a unique set of frameworks to assess company performance in relation to governing and managing corporate citizenship. It provides much needed data from companies across a number of industries to prompt further discussion on next generation corporate citizenship, where responsible business practices are woven into the corporate DNA.