Good questions.

The primacy of sound governance cannot be denied and should never be underestimated. Those who exercise power over the well-being of others and the life of the planet, or act as stewards of other people’s money, enjoy a covenant of trust that has few comparisons. Trillions of dollars around the world, and the fate of countless lives, are held in the balance.

Every time you use medication, board public transit, fly on a plane, shop in a grocery store, buy a bottle of water, make a bank deposit, invest money in a pension fund, use a mobile phone, visit a hospital or drive to work, you depend on sound governance practices to keep you safe, to avoid inflicting harm and to leave you better off.

That doesn’t happen by accident.

At its best, sound governance is built on the pillars of ethics and truthfulness, transparency and accountability and a deep acknowledgment that the powers that are exercised are “powers held in trust for the entire community.”

Some will say ESG is part of that equation. Others will put their trust in stakeholder capitalism or responsible investment.  As J. Richard Finlay wrote two decades ago, “only the well-governed corporation, built upon a foundation of ethics and integrity, is capable of ensuring that the needs of society are met”. It is the key to our hope of advancing the common interests of humanity and solving the greatest problems of our planet. Having had more to do with the evolution of these ideas than almost anyone alive today, he knows that the right decisions, which are the only ones that are acceptable, come down to the actions and values of one leader, one director and one decision-maker at a time.

Sound governance is the engine that drives the social contract between corporations and their stakeholders. It is what determines the E, S and G components of ESG.  It is the moral glue that keeps the modern corporation, with all its power, legitimate.

We know from painful experience all through the 20th and early 21st centuries about the consequences when directors fail to direct and sound governance is made to take back seat in the boardroom. The Finlay Centre’s predictions about the companies that failed or required government bailouts, from Nortel to Livent and Lehman Brothers to Bear Stearns, read like a chronicle of disaster foretold. Each had the fingerprints of bad governance all over it, as did the resulting worst recession since the Great Depression.

A. A. Berle, Jr., who, along with E. Merrick Dodd, Jr., are the fathers of modern corporate governance, taught that “legitimacy, responsibility and accountability are essential to any power system,” especially in a system where corporate powers are seen to held in trust for the entire community, as Berle noted in 1958.

Keeping a commitment to these ideas and advancing the cause of the well-governed corporation has been the animating mission of The Finlay Centre for Corporate & Public Governance from the beginning.

So readers, if you ask: why governance? And why The Finlay Centre for Corporate & Public Governance? You have your answer.