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The Toronto-based Canadian Coalition for Good Governance (CCGG) outlines how directors should oversee companies handling of environmental and social (E&S) issues in new guidance published on Tuesday.

The Directors’ E&S Guidebook provides recommendations for effective board oversight and company disclosure on issues such as climate change, extreme weather, and employee health and safety.

In recent years corporations have come under increasing pressure to demonstrate that they are properly identifying and managing these issues, CCGG says in a news release,  and, at the same time, investors are under growing obligations to consider these kinds of factors in their investment decision-making.

In response, the group launched a consultation process in 2016 to strengthen its guidance for directors in this area. The Directors’ E&S Guidebook reflects its consultations with corporate directors in Canada and abroad, an extensive literature review, and input from CCGG members, the group says.

“Companies and investors around the world are realizing that there must be a greater focus on E&S management as a critical driver of long-term shareholder value,” says Stephen Erlichman, executive director, CCGG, in a statement.

“CCGG hopes that the guidebook’s 29 principles-based E&S recommendations covering eight key governance areas will provide boards of directors with practical information that they can utilize to effectively oversee their company’s management of E&S factors,” he adds.

“The oversight of all significant risk factors is a core function of a corporate board. Every company should have a robust risk management system that includes E&S factors as a fully integrated part of the identification and assessment process. We encourage all company boards to use this guidebook for practical insights on how they can enhance their frameworks,” says Barbara Zvan, chief risk & strategy officer at the Ontario Teachers’ Pension Plan (OTPP), and chairwoman of CCGG’s E&S Committee.