The UK’s corporate governance watchdog for auditors, accountants and actuaries, the Financial Reporting Council (FRC), published its updated, and much more concise, code of corporate governance last week (16th July), claiming it was a code “fit for the future”.
Broadly welcomed by the business community, the code is the fruit of some consultation, and it’s refreshing that it has clearly listened to feedback during that consultation in producing the code. In particular, it makes a deliberate move away from corporate governance as a dry, static concept and makes it much more human.
This begins to make corporate governance of direct relevance to the public relations profession. The new code even makes a key point about the importance of a company’s board connecting and engaging with stakeholders, including staff, shareholders and other companies:
“This Code places emphasis on businesses building trust by forging strong relationships with key stakeholders.”
And the FRC’s chairman Sir Win Boschoff goes even further:
“This new Code, in its new shorter and sharper form, and with its overarching theme of trust, is paramount in promoting transparency and integrity in business for society as a whole.”
Building trust with stakeholders! Promoting Transparency! Upholding integrity in business for society as a whole! This is starting to sound like a pure public relations mantra – identifying stakeholders to create a better environment for engagement that can be mutually beneficial.
Within the public relations profession, we constantly talk about why and how public relations should find a place on the board if we’re to really have a say in strategic direction. And the CIPR’s focus on ethics as a core competency rings loud and clear here.
For me, this is a positive step from an industry body. This Code is not a dry piece of business rhetoric – it has the long-term sustainability of the UK’s economy at its centre and actually draws on some of the key competencies of public relations professionals within its recommendations for achieving its aims. I think that’s pretty exciting, both for organisations and public relations professionals.
I’m a big believer in synergies between industries and sectors. Certainly public relations doesn’t exist in its own world in isolation, we need to be aware of business, leadership and governance issues around us.
If this code is to achieve its aims and organisations are to embrace it, there is a real opportunity for public relations professionals to step up to the plate and demonstrate to organisations the positive role they can play in embracing transparency, guiding organisations with integrity and building trust. The door is well and truly open.