Over the past two decades, a cascading series of global studies, white papers and United Nations development goals has led to the adoption of long-term benchmarks for corporate environmental, social and governance initiatives. What about governance? Governance of what, exactly? Is it meant to be an internally facing initiative or does governance also apply to external factors? Both? As an executive of a legacy company who has expended a great deal of effort to promote the importance of their own internal governance, I feel it's high time that "G," the red-headed stepchild of ESG, is given its due.

What Governance Is. To begin, let's clear up any misconceptions about governance’s role. Governance initiatives should be reflective of the values of the company. A good internal governance program increases efficiency, lowers risk, eliminates waste and reduces capital costs-all of which can positively impact the share price. Let's review some best practices that organizations should consider in building a proper governance structure.

Governance is a comprehensive project that requires a collective effort on behalf of the entire workforce. A significant amount of good governance practice lies in establishing strategies and reducing risk-and you'll never have a complete picture without widespread participation throughout the process. If diversity in age, ethnicity, gender, skill sets and corporate titles are all vital considerations, how does your organization currently measure up? Make sure that whoever serves on the Board or governance steering committees is provided an equal voice in contributing to the overall effort.

If you're not consistently measuring your governance plan's effectiveness, what good is all the effort? Just the same, expect that adjustments will be necessary. There will no doubt be challenges to establishing sound and admirable corporate governance

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