Corporate sustainability ratings are apotentially powerful but still underused tool for building acompetitive, socially purposeful, and financially soundenterprise. In a globalizing world replete with businessopportunities and risk, corporate boards continually need toreappraise what constitutes good governance. Traditionalboard duties pertaining to strategic oversight, executivecompensation, and financial auditing will remain integralfor the foreseeable future. But these alone will not sufficein a time when the prosperity of companies is inextricablylinked to issues such as reputation, brands, supply chainmanagement, quality and quantity of human and intellectualcapital, protection of human and labor rights, and climatechange. Such emergent issues are part of a historical momentin which the role of companies in fostering societal andecological well-being at the global, national, and locallevels is under increasing scrutiny. These are conditionsthat fuel intensifying public discourse concerning corporatesocial responsibility, sustainable capitalism, shared valuecreation, and other linked concepts that challenge theconventional wisdom that positions shareholder value as theparamount measure of company success. Indeed, sustainabilityis not new to the two common definitions of corporategovernance: (i) the actual behavioral patterns ofcorporations in terms of efficiency, growth, financialstructure, and other attributes; and (ii) the normativeframework within which firms operate in terms of legalsystems, financial markets, and labor markets.
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