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Nov 05, 2024
Navigating the Caribbean Crossroads: Collaboration, Climate, and Corporate Responsibility
Insights from the Caribbean Corporate Governance Institute
A warm breeze flutters over the blue Caribbean Sea, while the bright sunlight reflects off the glass windows in the towns and cities, shining on people busy with their daily activities. Amidst this beautiful setting, however, lies deeper trouble - the increased frequency and intensity of hurricanes fueled by this deceptive warmth, high levels of crime, and the complex, dual-edged promise of AI and attendant cybersecurity challenges.
In boardrooms across our islands, directors are acutely aware of these threats, and companies are taking action. Some larger organizations are leading the way, by adopting the UN Sustainable Development Goals (SDGs). Yet, one key area remains underdeveloped - SDG #17, which emphasizes partnerships to address global challenges. This is particularly relevant in our region, where collaboration can be the key to mitigating the impacts of climate change, economic instability, and emerging technological risks.
Annual reports across the region often speak of 'a spirit of mindfulness' when interacting with the environment, investing in green energy, and embracing recycling. We are also witnessing a growing adoption of technology, with companies beginning to explore the benefits of AI while simultaneously building defence mechanisms against inevitable cyber threats.
Despite these efforts, there is a gap in collaboration. While companies may join industry associations or respond generously to requests to mitigate the effects of natural disasters, true partnership - the kind that involves shared strategies and collective problem-solving - is rare. Much of the joint reliance is placed on regional institutions like the Caribbean Catastrophe Risk Insurance Facility (CCRIF), which recently pledged payouts of 44 million USD to Grenada following Hurricane Beryl's devastation in June. However, businesses across all sectors suffer from the effects of damage to infrastructure, which leads to disruptions caused such as electrical outages and poor internet connectivity, and the loss of manpower hours. Collaboration could aid in greater loss prevention and faster recovery, but boards seem to be internally focused, primarily on individual achievements.
Collaboration can be the key to mitigating the impacts of climate change, economic instability, and emerging technological risks.
Moreover, there is little evidence that SMEs in the region fully understand their role in sustainability, which is essential for creating a circular economy.
However, it's not all doom and gloom; there is much to appreciate. Directors are increasingly aware of their fiduciary responsibilities, and many are embracing ESG principles and embedding them in their operations. For instance, the 200-year old, Angostura Limited has prioritized projects that improve water and energy use, exploring alternative energy sources like biogas and solar power. The ANSA McAL conglomerate started investing in renewable energy since 2015, and its subsidiary, ANSA Packaging, increased the volume of glass collected for recycling in Trinidad and Tobago by 91% between 2022 and 2023. The century-old Massy conglomerate has embedded ESG metrics across its portfolio throughout the wider Caribbean.
Boards across the region are also leveraging technology for sustainability. The larger financial institutions have led the way by utilizing electronic payments and digital transactions, which minimize paper use and reduce carbon footprints. National Commercial Bank (NCB) Jamaica has invested in alternative energy sources, funding wind and solar plants, while the JMMB Group, operating in four countries, has five solar powered locations in Jamaica, where it also harvests rainwater for irrigation during periods of drought. Republic Bank aims to set aside US$200 million for climate financing next year, guided by the Principles of Responsible Banking (PRB) and the Net-Zero Banking Alliance (NZBA). The First Citizens Group, like many others, is developing metrics to measure, track, and benchmark sustainability initiatives, providing data to their board for ongoing progress monitoring.
Nevertheless, one major challenge remains - the lack of reliable data for decision-making. Effective governance requires the breaking down of silos and a commitment to sharing insights and data across sectors. Collaboration can transform the culture, not just to manage the effects of climate change but to address pressing societal issues like crime and social well-being. This is where effective leadership becomes crucial, bringing together diverse entities for a common purpose.
The Caribbean Corporate Governance Institute (CCGI), through its focus on improving governance practices, is determined to fill this gap. By encouraging collaboration, fostering education, and promoting best practices, CCGI is playing a pivotal role in uniting the region's boardrooms, ensuring that we face our shared challenges with strength and resilience, united by a collective purpose.
Chief Executive Officer - Caribbean Corporate Governance Institute
Owned by: Institute of Directors, India
Disclaimer: The opinions expressed in the articles/ stories are the personal opinions of the author. IOD/ Editor is not responsible for the accuracy, completeness, suitability, or validity of any information in those articles. The information, facts or opinions expressed in the articles/ speeches do not reflect the views of IOD/ Editor and IOD/ Editor does not assume any responsibility or liability for the same.
About Publisher
Bringing a Silent Revolution through the Boardroom
Institute of Directors (IOD) is an apex national association of Corporate Directors under the India's 'Societies Registration Act XXI of 1860'. Currently it is associated with over 30,000 senior executives from Govt, PSU and Private organizations of India and abroad.
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