Governance may not be flashy, but it’s foundational. Unfortunately, it is often seen as a burden or barrier to running a business. However, if executed properly, leadership and its offshoots foster ethical operations, ensure transparency, and pave the way toward long-term success including the generation of sustainable profits and cash. It is a tool that supports leaders and provides an environment that empowers colleagues.
Setting the course
Company leaders bring vision, drive, experience, maturity, and expertise to the businesses they oversee. When these
qualities are applied with sensitivity and according to shared values, they produce increases in:
Trust and confidence from the team
Employee assertiveness when addressing problems and opportunities
Transparency within the organisation, as inconvenient truths are no longer hidden from higher-ups
Adherence to rules, norms, and regulations, as personnel are more engaged with and invested in their work activities.
Case Study
Thailand’s own PTT Public Company Limited is a case in point. The state-owned energy giant has leaned heavily on robust governance to navigate its own transition toward sustainability. The company’s board oversees long-term strategies like its decision to invest heavily in renewable energy and reduce carbon emissions, which has kept the organisation competitive at a global level while meeting national environmental goals.
PTT’s governance benefits from a multi-layered oversight structure that blends state-owned
accountability with private sector agility. Although PTT operates under the watchful eye of the Ministry of Finance and the State Enterprise Policy Office, its board and executives have carved out a system that prioritises long-term strategy over short-term wins, with the company’s overall direction shaped by a clear ethical compass.
This system is designed to ensure balanced as well as values-based decision-making. Comprised of five key committees (Audit, Nomination, Remuneration, Corporate Governance and Sustainability, and Enterprise Risk Management), PTT’s board examines proposed annual plans, budgets, and risk strategies according to Thailand’s energy security needs and global decarbonisation expectations.
Moreover, the board members are bound to six Good Corporate Governance Principles: Accountability, Responsibility, Equitable Treatment, Transparency, Vision for Long-Term Value, and Ethics. These ideals are enforced through a Code of Business Ethics Handbook that every director, executive, and employee must follow.
These built-in company guideposts, alongside other safeguards such as PTT’s zero-tolerance anti-corruption policy, have helped the company adeptly navigate political, economic, and environmental disruption over the years while still adhering to its core mission.
Crucially, the governance system outlined above follows strict mandates whose effect is to direct and refine company activity rather than grind it to a halt through bureaucratic inertia. Part of this refinement process, of course, includes legal checks to confirm that company activity falls within regulations.
Among other achievements, this holistic approach earned PTT the world's #1 ranking for oil & gas
companies in S&P’s Global's Corporate Sustainability Assessment.
Earning trust through accountability
As economies develop, so too do demands for transparency and regulatory compliance. Governance which prioritises clear reporting and corporate responsibility not only avoids potential legal penalties but also builds credibility with stakeholders.
Businesses such as PTT’s - with governance boards that emphasise ethical practices and transparency - find themselves with agreeable employees, customers, regulators, and investors alike, because these stakeholders can take comfort in the knowledge that high standards are maintained even behind the scenes.
Such policies and governance structures are indicative of good business health, which in turn attracts loyalty at every level. Internal audits, transparent analyses of sourcing practices, and other quality control initiatives similarly have the effect of increasing brand confidence, turning compliance and accountability into a competitive edge over time.
