Today, Capitals Coalition, with support from Pollination, publish a business decision template for boards or decision-making committees to ensure information on all capitals (natural, social, human and produced) are included in decision-making processes.
A trio of recently published legal opinions are building on the changing expectation that more capitals are expected to be represented during board decision-making. In October 2023, a legal opinion in Australia concluded nature-related risks are within the scope of directors’ duties to act with care and diligence. Last month, another legal opinion in the UK was published, accompanied by a campaign from Social Value International, encouraging company directors to include sustainability in their financial statements.
Today, a third legal opinion has been published, concluding directors’ duties under UK company law require consideration of nature-related risks to the business. As a result, the legal and regulatory context relevant to company and directors’ duties is fast changing.
In this context, the Coalition has published a business decision-making template to provide a structured and recognizable format for paper preparers, decision-making committees, and boards to include impacts and dependencies on nature, people, and society in decision-making processes.
At present there is no standard template to include essential information such as a business’s relationship with nature and people in decision-making processes. Without this, decisions are in danger of being sub-optimal and there is increased risk for the business, opportunities can be missed, and there is a greater chance of negative impacts on nature, people, and society.
Furthermore, with more mandatory reporting requirements forthcoming, is it becoming more necessary to have a holistic view of a business’s impacts and dependencies to make informed decisions.
The Coalition is inviting all businesses to participate in a consultation to pilot the templates in their decision-making processes. A clean version of the template can be downloaded here and is open to any business or financial institution with an interest in improving their decision-making processes.
Businesses who are interested to join a peer group to share experiences and gain insights or those wishing to provide feedback on the template, can do so by emailing info@capitalscoalition.org. The deadline for feedback is 13 June 2024. Full information on the consultation can be found here.
