Business sustainability has gained considerable attention from investors, regulators, standard-setters, business organization, academics, and the accounting profession in recent decades. This book defines business sustainability as a process of generating financial economic sustainability performance to create shareholder value, while achieving nonfinancial environmental, ethical, social, and governance sustainability performance in protecting the interests of other stakeholders including creditors, customers, employees, suppliers, government, society, and the environment. The role of business corporations in our society has evolved from profit maximization to creating shareholder value and, in recent years, to create shared value for all stakeholders. This book offers guidance to organizations for choosing between shareholder primacy and stakeholder primacy, and thus presents corporate governance in the context of shareholder capitalism model and stakeholder capitalism model. This book provides insights into managerial initiatives for advancing enterprise sustainability from greenwashing and business branding to creating opportunities for revenue generation, cost management, supply chain, business growth, and product and service innovation.
This book consists of four chapters covering all aspects of corporate sustainability with a keen focus on sustainability capitals, shareholder primacy, and stakeholder primacy concepts. Anyone who is involved with business sustainability and corporate governance, the financial reporting process, investment decisions, legal and financial advising, audit functions, and corporate governance education will be interested in this book. Specifically, corporations, their executives, the boards of directors, board committees, internal and external auditors, accountants, lawmakers, regulators, standard-setters, users of financial statements (investors, creditors, and pensioners), investor activists, business schools, and other professionals (attorneys, financial analysts, and bankers) will benefit from this book.
The primary theme of this book is on the examination of stakeholder primacy/capitalism and shareholder primacy/capitalism. As the book was going through the production and publication process, the International Business Council (IBC) of the World Economic Forum (WEF), in collaboration with the big 4 accounting firms, has released its final recommendations for a set of globally accepted, standardized, and industry-oriented environmental, social, and governance (ESG) sustainability performance metrics and disclosures. These recommendations suggest a move away from shareholder primacy and capitalism toward stakeholder primacy and capitalism. These recommendations are intended to provide guiding principles for focusing on the ESG sustainability factors of performance, risk, and disclosures on governance, people, planet, and prosperity. This book also highlights how people, business, and resources collaborate in a business sustainability and accountability model. This book is intended to cover a variety of issues relevant to business sustainability and their implications for organizations of all types and sizes. I hope you find this book relevant and useful to gain and maintain your business and personal sustainability.
Sincerely,
Zabihollah (Zabi) Rezaee
February 16, 2021