What is Corporate Governance?

Making your organization a sustainable company is the dream of many managers, and corporate governance plans have never been so aligned with this goal. Although in many cases there is still a long way to go, several organizations already have initiatives aimed at reducing the environmental and social impacts generated by their businesses. 

In this context, it is fundamental that companies promote internal dialogue on sustainability and adopt responsible management practices. In this article, you will see some details about this topic and take a closer look at what corporate governance is and how it fits into today's market. Shall we?

‍After all, what is corporate governance?

Corporate governance is a set of principles, guidelines, and rules that guide company management and how companies should behave when faced with issues involving ethics. The practice protects shareholders' interests, improves the quality of products and services offered to society, and reduces the risk of fraud and corruption within companies.

Thus, corporate governance actively promotes transparency in corporate management. Basic principles include, for example, regular accountability and compliance with laws.

What is the purpose of corporate governance? 

Corporate governance is an important tool to ensure management efficiency in companies. It contributes to shareholders and other stakeholders having confidence in company management and being able to better evaluate their performance, which can be extended to customers, employees, and suppliers.

The proper use of corporate governance allows companies to become more competitive in the market in which they operate. This is because they demonstrate greater social responsibility and commitment to sustainable growth.

What are its pillars?

The pillars of corporate governance are, above all, regular accountability, respect for laws, and ethical principles. Corporate responsibility consists of a company's obligation to adopt practices that respect the interests of its stakeholders.

In other words, corporate governance seeks to balance the company's needs with the expectations of the parties involved. Remembering that the main stakeholders in a company's operations are not just shareholders, but also employees, suppliers, customers, and society in general.

Corporate responsibility includes an ethical commitment to all these groups. Therefore, good corporate governance favors the development of a positive relationship with the brand, which reflects this in all areas, from the quality of products and services offered to society to strengthening the company's image in the market.

What are the benefits of its application?

So far, you have understood that corporate governance is very important for companies worldwide, as this movement seeks to protect shareholders' interests and improve the quality of their products and services. Consequently, there is an optimization of the brand image.

But there is another very important benefit: it helps reduce the risk of fraud and corruption in company management. This occurs due to the standards that govern this management and promote greater transparency in the financial and tax information disclosed by companies.

Thus, investors have a clear view of the risks involved in acquiring these assets and can evaluate them more accurately. This positive image makes the company much more attractive to those looking to invest and ensures that exemplary conduct can be maintained, analyzed, and optimized.‍

What is the relationship with sustainability, governance, and energy?

Sustainability is a concept that seeks the integration of three dimensions: environmental, social, and economic. The objective is for companies to bet on practices that lead to the improvement of these aspects, creating a sustainable culture that contributes to a cleaner future, in addition to making the business more competitive in the long term.

Some measures contribute to achieving this objective, such as the use of renewable energy, monitoring GHG (Greenhouse Gas) emissions, reducing waste generation, and the conscious consumption of water and fuel. All of this designed to contribute to sustainable development.

In the energy sector, sustainability is related to the production of energy from renewable sources. Furthermore, consuming energy from renewable sources implies the preservation of natural resources, lower waste generation, and consequently, sustainable and socioeconomic development.

Within corporate governance processes, information transparency is embedded, so that both consumers and investors can have greater clarity regarding the policies adopted by companies. In turn, companies have the opportunity to evaluate the best energy supply option for their operations, as well as share this decision with their stakeholders.

Therefore, it can be concluded that corporate governance is a set of principles that ensure ethics is applied throughout the companies' production process. It is necessary to provide greater security, not only to current and future investors, but to society as a whole. Having your brand aligned with a professional organization capable of fully meeting its own responsibilities is mandatory for organizations.

At Serena Energia, aligned with the requirements of B3's Novo Mercado, co-entrepreneurs are strongly committed to adopting the best corporate governance practices and always aim to go beyond legal compliance.

Voluntarily, they also strive to remain adherent to the Corporate Governance Principles proposed by the G20 of the Organization for Economic Cooperation and Development (OECD), which have become an international benchmark and are adopted as one of the standards of the Financial Stability Board (FSB).

In addition to governance, other innovations are arriving in the market to provide greater savings and help get rid of increasingly expensive electricity bills. This is the case with the Free Energy Market. 

See also:

• 8 actions to make your company sustainable

• How to manage electricity in the Free Energy Market?

• Agile Project Management: what it is and how it works