International Standard ISO 37000 | |
Governance of organizations — Guidance Gouvernance des organismes — Recommandations Reference number ISO 37000:2021(en) | First edition 2021-09
© ISO 2021
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Examples of the value generated by good governance include the following. |
— Improved long-term stakeholder value generation: Good governance promotes effective oversight of the organization and thus helps to ensure alignment between the organizational purpose, strategy, activities, and the United Nations Sustainable Development Goals (UN SDGs)[15]. This improves long-term stakeholder value generation. — Effective resource stewardship: Effective stakeholder engagement, protected disclosures (whistleblowing) and mediation, appropriate executive authority limits, consistent terminology, transparent decision-making and accountability, all contribute to improved stakeholder confidence that the organization is stewarding resources in a responsible manner. — Improved organizational resilience and performance: The organization is able to remain resilient when negatively impacted by its changing context and realize valuable opportunities as a result of these changes via good governance practices. These practices include adapting strategy, ethical leadership, effective succession planning, clear delegation of authority and responsibilities, and oversight of risk management and internal controls. — Improved decision-making effectiveness: With the increasing rate of change and complexity within which organizations operate, good governance promotes holistic consideration of the organization, its purpose, and the context within which it operates, resulting in improved decision-making. Clarity of accountability, responsibilities and delegated authority are good governance practices, which increase the speed of organizational decision-making, action and outcomes. — Improved personnel composition and retention: People who are motivated not only by financial interests, but also by the organizational purpose and by intangible organizational values such as fairness and transparency, are attracted to organizations demonstrating good governance practices, such as effective and ethical leadership. — Increased investor and creditor confidence: Effective leadership and oversight, holistic decision-making, transparency and effective stakeholder relations, sustainability considerations and certainty of compliance management all contribute to increased confidence in the organization. In turn, this can improve access to capital and reduce the cost of capital. — Increased value of intangible assets: Transparency with stakeholders and responsible organizational behaviour (corporate citizenship) contribute to the value of the organization’s intangible assets such as reputation, public image, public confidence and goodwill. |
Finally, good governance includes actions by the governing body (e.g. creating governance policies) to direct their organizations to provide stakeholders with transparent, clear and concise reports and access to information. This allows regulators and society, through their duly appointed representatives, to evaluate the organization’s positive and negative natural environmental, social and economic impacts. Good governance further affords stakeholders the opportunity to hold organizations to account, benchmark their results, highlight inappropriate practices, and monitor organizational impacts on society, the economy and the natural environment. |
Figure 1 — Governance of organizations — Overview | ||||||||||
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[1] | ISO 14001, Environmental management systems — Requirements with guidance for use | |
[2] | ISO 26000:2010, Guidance on social responsibility | |
[3] | ISO 31000:2018, Risk management — Guidelines | |
[4] | ISO 37001:2016, Anti-bribery management systems — Requirements with guidance for use | |
[5] | ISO 37002, Whistleblowing management systems — Guidelines | |
[6] | ISO 37301:2021, Compliance management systems — Requirements with guidance for use | |
[7] | ISO Guide 73:2009, Risk management — Vocabulary | |
[8] | ISO Guide 82:2019, Guidelines for addressing sustainability in standards | |
[9] | ISO/IEC 27001, Information technology — Security techniques — Information security management systems — Requirements | |
[10] | ISO/IEC 38500:2015, Information technology — Governance of IT for the organization | |
[11] | ISO/IEC 38505 (all parts), Information technology — Governance of IT — Governance of data | |
[12] | ISO/IEC 38507,2 Information technology — Governance of IT — Governance implications of the use of artificial intelligence by organizations | |
[13] | IEC 31010, Risk management — Risk assessment techniques | |
[14] | BS 13500:2013, Code of practice for delivering effective governance of organizations | |
[15] | United Nations Sustainable Development Goals. Available from: https://www.un.org/sustainabledevelopment/sustainable-development-goals/ | |
[16] | Information on the governance of organizations is available from: https://committee.iso.org/home/tc309 |
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