Conduct becoming

It’s now clear of the launch pad. The Institute of Directors’ brand new code of conduct for company directors has been finalised, given its wings and (gently) shoved out into the world.

Of course, we knew back in the summer largely what was going to be in the code and that it would be firmly based on the Nolan Principles, the standards by which Westminster politicians and civil servants operate.

The code, among other things, asks directors to demonstrate “exemplary standards of behaviour”; act with integrity and “strong ethical values”; make decisions “openly, honestly and clearly”; and “integrate ethical and sustainable practices into business decisions, taking into account societal and environmental impacts.”

That last one is interesting, because it essentially tackles a requirement many think is present in the directors’ duties set out in the Companies Act. It also comes just days after the IoD issued its thoughts on the Post Office/Horizon scandal: it suggested the UK was in need of a new corporate form that explicitly asks directors to balance the search for profit with the public interest.

Jonathan Geldart, director-general of the IoD, says: “We should be proud of UK businesses, but sometimes decision-makers fall short of societal expectations.

“Those at the top may lose touch with the need for exemplary values and integrity in their decisions and behaviours.

“This has led to scandals and controversies, negatively affecting business esteem. Without public trust, businesses may find their freedom increasingly questioned.” That puts it nicely.

Sustainability is big box office

And here’s a reminder why embracing sustainability is important (if one were needed).

Research from SEC Newgate finds that 75% of the public believe that big companies should approach their business in responsible ways.

Leyla Hart-Svensson, head of research at SEC Newgate, says: “The research shows that corporate responsibility remains a growing trend and public expectation—and this lies at the heart of what it means to be a good business with a good reputation.”

AI for the win?

Bad news for Luddites in financial reporting. According to new research, more than half of investors (57%), say artificial intelligence could be the “key to assessing credibility and accuracy of data”.

Conducted by EY, the research also found that 96% of the world’s financial leaders are “worried” about the reliability of non-financial data.

Nicolas Lecoq, global leader of EY’s financial accounting service, says: “Although AI is still in the early stages of adoption, and while it’s clear that many finance leaders are nervous about potential costs, compliance and wider possible risks, there’s no doubting its immense potential to transform data analytics and corporate reporting for the benefit of all.”

Myles Corson, EY’s global strategy leader, paints a daunting picture. He says it is “clear there are major worries among CFOs and the investor community around data transparency and non-financial information, which they cannot afford to ignore”.

If Board Agenda had a grim-faced emoji available, we’d use it.