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CS Professional · Environmental, Social and Governance (ESG) - Principles and Practice · Board's Accountability on ESG

Tara Cement Ltd's Board reviews its strategy annually. The Company Secretary suggests the Board record in its minutes how ESG considerations such as resource efficiency and stakeholder impact were weighed in approving a new plant. What is the main benefit of this practice?

Minuting how ESG factors were weighed in approving the plant evidences that the Board considered them in decision-making, which supports accountability and transparent reporting. It does not remove directors' duties, shift liability to the Company Secretary, or replace the need for ESG disclosures.

  1. AIt removes the directors' duty to act in good faith
  2. BIt transfers all ESG liability to the Company Secretary
  3. CIt evidences that the Board considered ESG factors in decision-making, supporting accountability and transparent reportingCorrect
  4. DIt makes any later ESG disclosure unnecessary

Explanation

Recording deliberations shows that ESG factors were actually considered in strategic decisions, supporting Board accountability and consistent disclosure. It neither removes directors' duties nor shifts liability to the Company Secretary, and it does not replace required disclosures.

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