Sustainability and Institutions

Published on by Dr. R. M. Maran

An abstract image representing governance and institutions.

SINGAPORE – Institutions are built over period of time but the beginning is not at a single day. The concept is perceived instantly or over a long period of time. Time is an important element of beginning even though it has no value potentially and the value addition is generated by virtue of events and energy resulting achievements and positive consequential effects to the growth and development. Sustainability is the concept which has no immediate relevance to time but to the consequential effects to the environment and development while environment and development are considered antithesis to each other. Thesis is the environment and development is antithesis while the synthesis is the sustainability. The sustainability is an enabling dialogue promoting the neutralization bad effects while pursuing continuous dialogue for growth and development. The Sustainable Development is engrafted through 17 Sustainable Development Goals that are drafted as global policy guidelines to achieve the consequential effects of sustainability to environment and development. This is an endless process of human history and humanity.

Man, and nature integrate with each other on the growth and development. Wisdom is seldom questioned but it is deliberated to dialogue causing consistency and discrepancy to the main theme of sustainability. The sustainability is an evolution and is a continuous dialogue and enabling practice of human growth and development within the given environment which is stagnate but dynamic.

The sustainability is a continuous process towards excellence and it demands energy and efficiency. Man is a social animal who needs a continuous training and development. He needs persuasion and participation with clarity. Man discovers and invents while living and learning. The environment is nature and it suffers from its own ingenuity while pervading the whole universe and humanity. The Environment is the source of human life and growth space. Everyday he discovers nature and identifies his energy with nature for multiplying them into synergy.

Man needs nature and without man the nature is empty without purpose. The Universe remains a distant land of mystery keeping alive science and technology to manifest his search for truth. The truth becomes a vanity of wisdom without identity and recognition when it has no relevance to man and nature. The linking relevance to wisdom is the empowerment of humanity to sustainable development through recognising the process and evolution of sustainability.

The earliest institutions of man are the forest, hill and mountains and his learning is continuing as there is a multiplication of institutions ranging from caves to modern shelters, scientific laboratories to class rooms, language to Artificial Intelligence, transportation to launching rockets and satellites, cycles to aero planes, pencil to computer, and so on. The wisdom is constantly growing and shaping humanity while realizing the importance of nature through identifying him with environment. Thus, sustainability is dynamic and glorious.

Man grows with institutions and institutions preserve humanity. The sustainability enables man to promote and regulate institutions as institutions demand support and surveillance which man can offer. The survival has shaped the institutional structure and struggle for existence teaches him the essence of sustainability. Man remains active for growth and development and in the process he himself is the victim of his overenthusiasm and adventurism. The sustainability teaches and trains to find solutions and, in the process, it opts for preservation. He identifies his skills to meet these challenges.

Institutions develop its own mechanism to survive and grow and that forms the basis for sustainability. This is the part of governance. Slowly legislations and rules and regulations are equipped with the spirit of governance. The governance has both internal structure and external embodiment. Institutions need people and it has to govern with norms and principles to social structure consisting of insiders and outsiders. The means of production include material and natural resources, reflecting the part of environment. The institution directly and indirectly interacts with nature, environment.

ESG stands for Environmental, Social, and Governance. It is a framework used to assess an organization's business practices and performance on various sustainability and ethical issues. Investors, consumers, and other stakeholders increasingly use ESG criteria to evaluate a company's long-term viability and its impact on the world. The three pillars of ESG are:

1. Environmental

This pillar examines a company's impact on the natural world. It encompasses a wide range of issues related to environmental stewardship and sustainability. Key considerations include:

  • Climate Change: A company's greenhouse gas (GHG) emissions, carbon footprint, and efforts to transition to a low-carbon economy.
  • Resource Management: How a company manages its use of natural resources such as water, minerals, and land. This also includes its approach to waste management, recycling, and the circular economy.
  • Pollution and Waste: The generation of pollutants and waste from a company's operations and its efforts to minimize and remediate environmental damage.
  • Biodiversity and Land Use: A company's impact on ecosystems, biodiversity, and deforestation.
  • Energy Consumption: The sources and efficiency of a company's energy usage, including the adoption of renewable energy.

2. Social

The social pillar focuses on how a company manages its relationships with its employees, suppliers, customers, and the communities where it operates. It addresses a broad range of human and social issues, including:

  • Human Capital Management: A company's labor practices, including fair wages, working conditions, employee health and safety, and opportunities for training and development.
  • Diversity, Equity, and Inclusion (DEI): The diversity of a company's workforce and board of directors, as well as its policies and programs to promote an inclusive and equitable workplace.
  • Customer Welfare: Product safety and quality, ethical marketing practices, and data privacy and security.
  • Community Relations: A company's impact on local communities, including its engagement with community stakeholders and its contributions to community development.
  • Human Rights: Respect for human rights throughout a company's operations and supply chain.

3. Governance

The governance pillar deals with a company's leadership, internal controls, and shareholder rights. It is concerned with how a company is managed and overseen to ensure accountability, fairness, and transparency. Key aspects of governance include:

  • Corporate Governance: The structure and diversity of the board of directors, executive compensation, and shareholder rights.
  • Business Ethics and Transparency: A company's policies and practices on issues such as bribery and corruption, lobbying, and political contributions.
  • Risk Management: The identification and management of ESG-related risks and opportunities.
  • Audit and Internal Controls: The integrity of a company's financial reporting and internal control systems.
  • Shareholder Rights: The extent to which a company protects the rights and interests of its shareholders.

In essence, the ESG framework provides a holistic view of a company's performance beyond its financial results. It helps stakeholders understand how a company is managing its environmental and social impacts and whether it is being run in an ethical and responsible manner.

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