The European Commission’s Directorate-General for Financial Stability, Financial Services and Capital Markets Union (DG FISMA) has recognised the importance of companies reporting accurate information for the efficient operation of financial markets in its recent consultation on the quality of corporate reporting. In particular, in its Call for Evidence on the… Read More
Delivering purpose through robust management processes
The notion that firms exist primarily to deliver dividends for their shareholders has been openly challenged in recent years. There is a growing consensus among business leaders, academics, and policymakers about the benefits of businesses defining and measuring their corporate purpose beyond merely growing their bottom line.
The drivers of this change in mindset are diverse—from concerns about protecting the environment and corporate equality and fairness to the revolution in working patterns spurred by the COVID-19 pandemic.
Oxera’s governance experts can help your firm find its way. We have a wealth of experience advising regulators, corporates, and investors on alternative mechanisms, including governance rules, board composition, financing structures, and executive remuneration.
The purpose of our work
The onus is now on corporations to fully understand the effects of their operations. This means going beyond financial performance to assess the other four forms of capital—natural, social, human, and manufactured.
With many decades’ experience underpinning this market-leading governance advice, we can help you understand how to identify and overcome market failures. We do this by:
- aligning the interests of investors and management
- reducing the cost of capital
- defining and embedding purpose into your organisation
- operationalising purpose within the five capitals framework
- completing ex ante investment appraisals before budget is allocated to the five capitals
- reporting on ex post financials
- reviewing KPIs-based executive remuneration
Aligning purpose and regulation
We advise authorities and businesses on appropriate mechanisms to align the regulatory system and corporate purpose.
For example, in the utilities sector, we link outcomes-based approaches and financial incentives to the five capitals.
In financial services, we devise strategies that connect the conduct risk framework to the interests of consumers, and society as a whole.
Meanwhile, the increasing pace of digitalisation is giving rise to new business models that monetise data in various ways. This brings new challenges for both firms and regulators in defining what good outcomes look like, and how to improve them. We’re ready to help you address these pressing questions.