Corporate governance is at the heart of the challenges for a more responsible post-Covid period. For good reason, the health crisis leads to a social crisis and an economic crisis. It also exacerbates questions about corporate environmental responsibility. Always postponed to the next day, CSR seems this time to find a more important place in societies. Although the findings are mixed. In reality, the idea of the green recovery does not necessarily meet its audience. With uncertainties and declines in turnover, 40% of companies think they are limiting their investments, including those related to the environment. For others, it is an opportunity to rethink corporategovernance. Reason to be, relationship with stakeholders, ability to anticipate, risk management…
The health crisis has shaken up the working habits of companies and consequently other markets. Indeed, the generalization of teleworking has disrupted the entire world of work. In order to adapt to the exceptional measures put in place to curb the spread of the virus, companies have had to rethink their operations. They have thus abandoned the offices. As a result, these changes have led to an economic shock in the real estate market. This has notably disrupted the professional and residential real estate market. Indeed, these two markets are correlated in terms of evolution and price. There is a contagion effect.
In the long term, the health crisis poses a question of changing demand. According to the June 2021 note of the Banque de France,the decline in total or partial activity of companies and the implementation of teleworking have led to a 0.4% dropin the price of real estate. At the same time, the price of residential housing was subject to an increase of 5.3%. If companies have adapted to the crisis and today they have resumed their activity, work is organized in a hybrid way between face-to-face and remote. Thus, the real estate market remains on these reserves in the face of new habits and strategic changes of companies that play a decisive role in supply.
Post-pandemic corporate governance, lessons for post-Covid
The book “Corporate governance after the pandemic”will be published on 31 March 2021 (1). At the origin of this project, Ivan Tchotourian. Professor at the Faculty of Law of Université Laval, co-director of the Centre d’études en droit économique, founding member of the Laboratoire interdisciplinaire sur la responsabilité sociale des entreprises (LIRSE) and regular researcher at the Institut Hydro-Québec en environnement, développement et société (EDS), he is not in his first work on corporate governance.
On the other hand, the context of the health crisis pushes him to study the issue of post-Covid corporate governance. More than a question specific to each company, it addresses CSR as a subject of law. Which could have the power to put companies before their responsibilities. In his book, he seeks to delt into the subject in a comprehensive and complementary way. A way to live better after Covid as well as to know how to better anticipate a new crisis.
Well aware of not raising a new problem,“Corporate governance after the pandemic” mainly traces publications during the health crisis to emphasize the urgency and relevance of a more successful CSR policy.
CSR, eye powder or real growth vector?
The legal framework related to the Corporate social responsibility is growing year after year. Sapin II law for the supervision of suppliers, ethics committee, business travel plan… However, even today, these provisions are more about creating documents of good conscience than about vectors of concrete change in the way the company lives.
To remedy this, experts recommend real actions at the level of corporate governance. Speeches that are multiplying in this time of Covid. These actions would allow the core of the business to evolve, business processes and added value. This could involve allocating more resources to identify risks in supply chains; the development of more sustainable and cooperative innovation among stakeholders; the definition of a more transparent, diverse and local supplier relationship. But also the improvement of the training of managers in CSR and responsible management; ensuring pay equity; or the generalization of teleworking. (2)
More than a story of awareness and brand image, CSR seems to also have financial advantages. Proxy advisory agencies, as well as investors and shareholders themselves, are increasingly turning to companies with successful CSR policies (3). In addition to seeking to contribute to a more responsible economy, they are also aware of the financial value of such an approach. Thus, according to Novethic,having an environmental policy would generate opportunities of the order of 10,000 billion dollars per year. As well as the creation of 395 million jobs worldwide by 2030.
Flexibility of time and workspace, a major issue in post-Covid corporate governance
Post-Covid corporate governance seems to have a lot to gain from improving the flexibility of time and workspace. In fact, this is much more about the attractiveness of talent and the improvement of the employer brand. In this regard, the health crisis has already made it possible to establish the extent of the repercussions.
Depending on the way people work and the types of management,the transition to remote work has been more or less smooth.
Thus, the implementation of teleworking requires a certain level of trust, as well as adapted tools. Companies already equipped with the necessary software and processes accordingly were already more mature on the subject. As a result, they were able to move work from the office to remote work more easily and quickly. For others, the process took longer.
It was therefore with the support of the managers that the transition was possible. In this sense, trust had to be put back at the heart of the teams. Also the opportunity to (re)aware of the value of each one, this new flexibility, well managed by management, gives rise to a renewed commitment of the teams to the company. Thus, contrary to conventional wisdom that economic performance has skyrocketed, the results have often been very positive.
In addition, this forced change in working methods has put the finger on the possible difficulties of adaptation in the event of a crisis. This is an opportunity for many companies to review their processes and improve their crisis management policies.
In addition, teleworking seems to be able to respond to problems peripheral to the company.Reduction of CO2 emissions and fluidity of travel on the one hand, for the environment; improvement of the qualityof life and better management of the work/life balance,on the other hand, for employees.
“Corporate Governance After the Pandemic,” Ivan Tchotourian, published March 31, 2021