Governance is the systems and processes that ensure the overall effectiveness of an entity – whether a business, government or multilateral institution.
Promoting good governance is a multi-dimensional challenge, which requires efforts that are mutually reinforcing. For example, anti-corruption is essential to the rule of law and peace-building because corruption negatively impacts state capacity, social inclusion, and management of natural resources. Peace is an enabler of sustainable development and is a pre-condition for the establishment of the rule of law and efforts to reduce corruption. Finally, rule of law is necessary to effectively address the drivers of violent conflict, illicit financial flows, and impunity, and to provide a legal framework which ensures impartiality and predictability.
Companies can engage with the UN Global Compact on the three critical governance topics: anti-corruption, peace and rule of law. At the micro level, companies can enhance good governance by integrating corporate sustainability principles into their own operations and relationships, allowing for greater transparency, accountability and inclusiveness. At the macro level, companies can contribute to the development and implementation of international norms and standards, for instance, as part of their commitment to the UN Global Compact.
By focusing on the ways companies can contribute anti-corruption, peace and rule of law, at both the global and local levels, the UN Global Compact is able harness the power of responsible business to respect and support the promotion of accountable and inclusive institutions and ensure just and peaceful societies for all.