Companies can benefit from caring for the Earth, says King
Corporate governance guru Mervyn King urged company directors yesterday to protect the Earth - not just for the feel-good factor, but to help their financial bottom lines.
King, a former judge who has held a series of company directorships, is chairman of the committee that has issued two reports on corporate governance that bear his name. A King III report is due to be published soon.
He told a conference on business ethics in Cape Town that corporate governance included the "moral obligation to do something about the quality of the Earth".
"We have created a quality of Earth that we cannot leave to our children," he said, citing Coca-Cola and Procter and Gamble as two multinational companies that had accepted their responsibility to protect the environment.
"The book value of Coca-Cola on the New York Stock Exchange a few weeks ago was 13percent of its price - its brand is the other 67percent."
The duty of the company's directors, King said, was to protect the goodwill represented by the brand value.
He said company directors needed to be more transparent and to build the trust and confidence of their stakeholders.