Fletcher Building, a company currently included in many Money Matters client portfolios, has won the Excellence in Governance Award at the 2014 Deloitte/Management Magazine Top 200 awards. Rodger helped create this award category back in 1999, to recognise the increasing awareness that a commitment to business ethics and a responsible approach to society and the environment provides significant long-term benefits for all the company’s stakeholder, including shareholders.
The award was inspired by Rodger's PhD which itself, was partly inspired by an initiative in 1990 from the USA-based Business Enterprise Trust that took out advertisements in the New York Times and Wall Street Journal asking readers to “Tell Us About the Business decision You Most Admire”. The advertisements began by noting that “It’s one of the great untold stories in business – the success of individuals and companies who know there’s more to good business than next quarter’s bottom line”.
Responsible investors make an award similar to the Business Enterprise Trust Award and Excellence in Governance Award whenever they assess a business as having satisfied their ESG (environmental, social and governance) criteria. Back in the 1990s the responsible investment perspective was not widely understood by business leaders. Indeed when the New Zealand award was first announced at the 1999 award ceremony attended by over 700 business people it was greeted by howls of laughter and many comments about “business ethics” being an oxymoron. Over the years, the award has become increasingly sought after, reflecting the greater focus on business ethics and good governance. Few would laugh about this now – and it would be wise to be wary of investing in those that do.