Sustainability cannot go ahead without governance – the Danone’s case shows why
Intriguingly, there has been much progress so far to address the G side of ESG. Companies look for a governance system protecting both stakeholders and shareholders, the company’s values and financial results altogether. This very outcome would not come alone. Building an efficient, effective and sustainable corporate governance system is indeed the most challenging process for modern enterprises. This challenge has been launched in 1976 by the OECD, whose seminal research drove systemic change for worldwide businesses .
While observers shall wait the next few months for further developments, there is a case to be presented. It is a wide held view that instability in companies’ governance system might trigger a wide array of (uncomfortable) side effects. A very recent case in this sense has been spotted in France. An uncomfortable dispute in Danone’s shareholders’ meeting between “responsible business” active shareholders and “financially sensitive” shareholders has led the company’s top management to an inner conflict leading to the ejection of the CEO Emmanuel Faber . I will not judge politically with the risk to be a “profit seeker” on the one hand or a “moral shareholder” on the other. Danone’s case rather fits for the purpose of describing how important is it for a multinational enterprise to be observing a set of principles for sustainable corporate governance, in order to avoid the risks of inner conflicts. Indeed, the point for a sustainable company is to pursue Environmental, Social and Governance issues at the same time. As we are dealing with corporate governance, Danone’s case showed how relevant is the need of stability inside a company. The most immediate solution to avoid such problems, whose impacts might be jeopardising companies’ operations, is to follow a set of universal, common rules.
A cura di Manfredi Morello
 OECD (2011), OECD Guidelines for Multinational Enterprises, OECD Publishing.
 OECD (2015), G20/OECD Principles of Corporate Governance, OECD Publishing, Paris.
 European Commission (2021) Sustainable corporate governance legislative initiatives.
 The Conversation (2021) Danone’s CEO has been ousted for being progressive – blame society not activist shareholders.