The Evolving Role of the Quantity Surveyor in Modern Infrastructure

 

The Evolving Role of the Quantity Surveyor in Modern Infrastructure

by AM Tris Hardyanto

Introduction: More Than Just Numbers

The role of the Quantity Surveyor (QS) has undergone significant transformation over recent decades, particularly as the construction industry increasingly faces the complexities associated with mega infrastructure projects. Traditionally viewed as financial controllers, QS professionals have evolved into vital experts who undertake a variety of strategic responsibilities, encompassing not only cost management but also risk mitigation, contractual compliance, value engineering, and the adoption of advanced technologies such as Building Information Modelling (BIM).Evolution reflects a broader recognition of the crucial function that QSs serve in ensuring the success of complex projects that involve significant investment and engineering challenges (Chan et al., 2018; Ying & Kamal, 2021; Babatunde et al., 2019).

In modern mega infrastructure projects, the QS is integral to the planning and operational phases, utilising advanced methodologies to achieve accurate quantification and costing. The sophistication of projects—including wastewater treatment plants and extensive tunnel networks—requires a nuanced understanding of various factors that impact costs and timelines. By leveraging digital tools such as BIM and geospatial data, QS professionals can provide reliable bills of quantities (BOQs) that reflect the variable realities on the ground, thereby enhancing overall cost certainty (Koseoglu et al., 2019; Ying & Kamal, 2021).approach is particularly critical in regions where large-scale projects face unique challenges in material procurement and lifecycle cost modelling (Wang et al., 2023).

Moreover, the necessity for QSs to engage meaningfully in contract administration and compliance has intensified amid the increasing complexity of mega projects, particularly those falling under various contractual frameworks such as FIDIC and NEC (Ward et al., 2019). The evolution of procurement methods, primarily through Public-Private Partnerships (PPP), has necessitated a balance between public accountability and private sector efficiency. Consequently, QS professionals are tasked with navigating these intricate operational frameworks while managing complex payment schedules and ensuring contractual fidelity (Ward et al., 2019; Journal, 2024). Their role extends to safeguarding project budgets by implementing phased material scheduling and closely monitoring supplier performance, thus fostering an environment conducive to adherence to budgetary constraints (AAG & Latief, 2023; Kadiri et al., 2024).

Risk management has also emerged as a significant aspect of the QS’s responsibilities, with many projects adopting risk-adjusted quantitative measures early in the planning process.A proactive stance allows QS professionals to embed flexibility into contracts, ensuring accurate quantification of scope changes. The ability to document, defend, and navigate claims effectively has become paramount as cost overruns remain a common issue in mega projects. Additionally, as the landscape of risk continues to evolve, particularly in the wake of global phenomena such as the COVID-19 pandemic, QS practitioners find themselves at the forefront of developing and implementing robust risk mitigation strategies to address unforeseen challenges effectively (et al., 2023; Abdullahi et al., 2023).

The changing professional landscape has underscored the importance of integrating QS expertise into the early phases of project planning. Studies indicate that engaging QS professionals at the onset can lead to improved cost control, better risk allocation, and enhanced project outcomes (et al., 2023; Sroka, 2021). For instance, integration of QS skills has demonstrated significant advancements in lifecycle cost management in various projects, showcasing the potential for optimised resource allocation when these professionals are involved from inception to completion (Wang et al., 2023; Nahyan et al., 2012). Thus, the evolution of the quantity surveyor role is not confined to cost management but extends to strategic project integration (Zhao & Cheng, 2018).

Furthermore, the advent of technologies such as Artificial Intelligence (AI) and data analytics is reshaping the profession, emphasising that modern QSs must be adept at leveraging data for cost estimation and financial forecasting. These digital tools enhance the ability to analyse historical data and project future costs more accurately than traditional methods permit (Khairina et al., 2021; Mustafa et al., 2024). Quantity surveyors must now combine traditional quantitative skills with computational capabilities to optimise project delivery, maintain financial viability, and improve overall project outcomes.

In summary, the evolving role of quantity surveyors in modern infrastructure projects encapsulates a shift from traditional cost control to strategic engagement in project management, risk mitigation, and technological adoption. Transformation underscores the critical importance of QSs in navigating the complexities associated with mega projects, ensuring they not only meet financial and operational targets but also contribute more broadly to sustainable and strategic infrastructure development (Chan et al., 2018; Babatunde et al., 2019). As the industry continues to evolve, the competencies required of quantity surveyors will expand, demanding continuous professional development and adaptation to emerging technologies and methodologies.

In conclusion, the quantity surveyor’s role is increasingly pivotal in steering the construction industry toward more sustainable and efficient practices, effectively transforming them into strategic leaders capable of delivering value beyond mere numerical metrics.

Core Responsibilities: Precision at Scale

In the context of the Jakarta Wastewater Treatment Plant (WWTP) project, the role of the Quantity Surveyor (QS) is multifaceted and pivotal in achieving precise financial management and project execution. The responsibilities include a range of tasks that require analytical and practical skills, ensuring that costs are managed effectively and that the project progresses within its defined parameters.

One of the core responsibilities of a QS on a project involves quantity takeoffs and vendor evaluation. This process encompasses the extraction of precise material and labour requirements from technical drawings. By systematically analysing these specifications, the QS can prepare accurate estimates that directly inform procurement strategies. Furthermore, evaluating vendor quotations is essential; it allows the QS to ascertain the best value propositions without compromising on quality, thereby ensuring financial efficacy throughout the project’s lifecycle (Yap et al., 2021). Rigorous assessment helps minimise cost overruns by leveraging competitive pricing while maintaining standards (AAG & Latief, 2023).

Subsequently, the drafting of subcontract and procurement agreements becomes crucial. Clear contracts delineating deliverables, timelines, and payment terms are vital to mitigating the risks of disputes among stakeholders (Victar et al., 2022). An effective QS delivers contracts that not only protect the project’s interests but also promote transparency and accountability between parties involved (Victar et al., 2023). Contractual clarity extends to the as-built measurements, where the QS is responsible for validating completed works against initial design specifications. Validation ensures that all financial claims reflect the actual work completed, thereby preventing discrepancies that could lead to payment issues down the line (Akomea-Frimpong et al., 2024).

Moreover, developing accurate cost estimates and forecasts is foundational within the QS’s role, supporting financial planning from the feasibility stage through to project closure. Such forecasts must be dynamic, taking into account market fluctuations and incorporating contingency allowances for identified risks (“Innovative Changes in Quantity Surveying Practice through BIM, Big Data, Artificial Intelligence and Machine Learning”, 2020). A forward-looking perspective bolsters the project’s financial strategy and allows for informed decision-making regarding resource allocation (Theddy & Pranoto, 2024).

A significant aspect of financial oversight during project execution involves claims verification. The process ensures that all invoices submitted by subcontractors and suppliers accurately reflect the progress made on-site, thus protecting the project’s financial integrity before any payments are authorised (Alimi et al., 2021). Inevitably, disputes could arise; hence, the QS must have a methodical approach to verify these claims against documented progress and quality standards (et al., 2023).

Additionally, Variation Order Management highlights the QS’s capacity to adapt to changing project requirements and client requests. The QS coordinates with various stakeholders, particularly consultants, to assess and approve changes that impact the project’s budget or timeline without causing disruptions (Siahaan et al., 2024). function demands an agile mindset and the ability to negotiate and communicate variances effectively, which ensures continued project alignment with initial objectives (Park et al., 2020).

As these responsibilities unfold, the demand for speed and precision has intensified. Hence, the adoption of modern technologies plays a crucial role in the QS’s effectiveness. AI-powered construction technologies augment traditional methodologies, offering enhanced data accuracy and efficiency in tasks such as cost estimation and project monitoring (Victar et al., 2023). These technologies not only accelerate processes but also improve the reliability of financial analyses, supporting the QS in navigating the complexities of mega infrastructure projects.

In conclusion, the role of the quantity surveyor in the Jakarta WWTP project is strategically vital for delivering a successful outcome. Their involvement spans from early planning through to execution, integrating cost management, contractual negotiation, and technological innovation to ensure that every aspect of the project is meticulously controlled. The QS not only ensures compliance with financial constraints but also enhances overall project delivery by maintaining focus on quality and efficiency throughout the life of the project.

Challenges in Conventional QS Practice

In the realm of traditional Quantity Surveying (QS) practice, several persistent challenges hinder efficiency and effectiveness. These challenges include data fragmentation, manual repetition, reactive risk management, and slow collaboration among stakeholders. Each of these factors contributes to increased project risks, reduced productivity, and missed opportunities for value optimisation, highlighting critical areas where improvements are necessary.

Data fragmentation is a significant challenge within conventional QS workflows. Information related to construction projects is often scattered across various platforms, including emails, technical drawings, paper files, and siloed databases. Fragmentation leads to difficulties in information retrieval, which can be slow and error-prone (Nawi et al., 2014). The implications of the issue are severe, as delayed access to crucial information can impede decision-making processes and ultimately affect project timelines and budgets (Tanga et al., 2022).

Furthermore, the reliance on manual methods for measuring quantities, counting symbols on drawings, and cross-checking invoices results in manual repetition that consumes considerable time and resources. Manual oversight can cause delays in processes that require prompt feedback and corrective actions. As a result, the overall efficiency of the QS function may diminish, complicating the timely delivery of projects (Ingle et al., 2020). The repetitive nature of these tasks can also lead to human error, further exacerbating the likelihood of inaccuracies in cost estimation and reporting (Nawi et al., 2014).

Reactive risk management is another challenge facing traditional QS practice. In conventional workflows, issues such as cost overruns and contractual disputes are often identified only after adverse consequences have occurred. A reactive approach to risk management is increasingly recognised as inadequate in an environment where rapid changes in project scope are common (Abdul‐Rahman et al., 2015). Suboptimal risk identification processes can lead to adverse outcomes for projects, necessitating a shift toward more proactive methodologies that emphasise early detection and resolution of potential issues (Basir et al., 2023).

Finally, slow collaboration among various project stakeholders, including QS teams, engineers, and contractors, results from the absence of a unified data platform. Without real-time access to shared documents and updated information, teams may operate on conflicting versions of project data, leading to inconsistencies and misaligned objectives (Eze et al., 2019). The fragmented communication channels not only impede effective coordination but also foster an environment ripe for misunderstandings and mismanagement, thereby increasing project risks further (Latiffi & Zulkiffli, 2022).

In conclusion, the integration of advanced technologies and collaborative tools presents significant potential for addressing these traditional challenges in QS practice. By adopting integrated management information systems and digital platforms, the construction industry can streamline data processes, improve risk management, and foster better communication among stakeholders. Transitioning from fragmented practices to a more cohesive and collaborative model is paramount for optimising project outcomes.

AI as a Catalyst for QS Evolution

The integration of Artificial Intelligence (AI) in Quantity Surveying (QS) practices has emerged as a pivotal development, addressing many of the longstanding challenges inherent in traditional methodologies. As the construction industry evolves, AI technologies catalyse a revolution in how QS professionals operate, enabling them to transcend repetitive tasks and enhance their strategic decision-making capabilities. A detailed exploration of AI-driven innovations reveals their transformative potential within the sector.

One of the most significant advancements brought about by AI is the automation of quantity takeoffs. Platforms such as Autodesk Takeoff utilise advanced algorithms to automatically detect and quantify elements on digital drawings, leading to a considerable reduction in the time traditionally required for manual measurements.Shifting from manual to automated processes not only accelerates the overall project timeline but also minimises human error, thereby improving the accuracy of assessments significantly. The reliance on AI for this purpose allows QS professionals to redirect their focus from laborious quantity measurement to more strategic responsibilities that demand their expertise.

Moreover, predictive insights facilitated by AI technologies empower QS professionals to address potential financial and operational risks proactively. By analysing historical data and identifying patterns, AI systems can flag potential cost overruns and highlight performance risks associated with subcontractors well before these issues escalate into disputes.Predictive capability transforms risk management from a reactive to a proactive stance, enabling better foresight and planning, which is crucial for the timely delivery of projects and maintaining budgetary constraints.

Generative AI has also found its place in the documentation processes of QS practices. Large Language Models (LLMs) can now draft tender documents, summarise contracts, and extract relevant clauses rapidly and accurately. Not only does it save time, but it also enhances the quality of the documentation by ensuring consistency and precision in the language used across various contracts. Such capabilities significantly streamline the administrative burden on QS teams, allowing them to focus on more complex contractual negotiations and strategic planning.

In addition to these functionalities, intelligent search capabilities integrated into Common Data Environments (CDE) enable QS teams to access vast amounts of historical data, vendor performance records, and technical specifications with unprecedented speed. Tools like ChatGPT can interactively provide insights and retrieve relevant information instantaneously, contextualised to current project requirements. The ability to quickly access and process critical data fosters a collaborative environment where QS professionals can make informed decisions swiftly, thus reducing delays caused by information retrieval.

Ultimately, the infusion of AI tools into QS practices does not signify a replacement of the quantity surveyor; rather, it liberates them from mundane, repetitive tasks, allowing for a more strategic deployment of their skills. The ability to harness AI technologies translates to enhanced efficiency, reduced error rates, and improved collaborative dynamics among project stakeholders. As the construction industry increasingly embraces these technological advancements, the future role of the QS will likely focus on higher-level strategic functions, including value optimisation, risk management, and stakeholder engagement.

 Evolution underscores the importance of ongoing professional development in the face of technological changes. Quantity surveyors must become adept at utilising AI and related tools to stay competitive and relevant in a rapidly changing landscape. Continuous training and adaptability will be essential for leveraging these innovations to improve project outcomes and enhance the overall efficacy of construction processes.

In conclusion, the incorporation of AI in quantity surveying practices heralds a transformative shift, empowering professionals to enhance their strategic roles within the construction environment. As AI technologies mature, their integration promises not only to address existing pain points but also to redefine the scope and impact of the QS profession.

The Human–AI Partnership

The evolution of the Quantity Surveyor (QS) role in the construction industry is significantly influenced by the integration of Artificial Intelligence (AI) technologies, paving the way for a hybrid professional landscape. While AI provides remarkable efficiencies in data handling, analytics, and documentation, the human element remains crucial for negotiating, understanding client needs, and balancing multifaceted project demands. Interaction, particularly in major initiatives, exemplifies the necessity of combining human expertise and AI capabilities for project success.

AI’s contribution to the QS field is apparent in key areas. Automated systems enhance the accuracy and speed of quantity takeoffs. For instance, tools like Autodesk Takeoff utilise algorithms to analyse digital drawings, enabling QS professionals to determine required material counts quickly. These systems significantly reduce the time involved in manual measurements, a process that is labour-intensive and prone to human error (Victor, 2023). Consequently, automation allows QSs to focus their efforts on higher-level thinking and strategic analysis.

Moreover, predictive insights from AI tools aid in identifying potential risks, such as cost overruns and subcontractor performance issues, allowing QS teams to implement preventive measures earlier. By leveraging historical data with AI analytics, quantity surveyors enhance their risk assessment and management capabilities (Gao et al., 2023; Obiuto et al., 2024).

In documentation, generative AI contributes significantly by draughting contracts, summarising complex agreements, and extracting crucial clauses efficiently. Large language models like ChatGPT assist in reducing administrative burdens while ensuring compliance with legal standards in documentation, which is vital for large-scale projects requiring meticulous oversight (Rane et al., 2023; Victor, 2023).

Additionally, intelligent search functions within Common Data Environments (CDEs) facilitate rapid access to historical project data and documents. Centralised information enhances collaboration and decision-making among project participants, further reducing the time spent on information retrieval and reliance on outdated documents (Fernández et al., 2022; Ali et al., 2022).Real-time access fosters better communication, reduces conflict, and creates a more cohesive project team atmosphere.

Despite the efficiency gains from AI, the indispensable role of human judgement remains vital. Negotiating with contractors and interpreting client needs requires a nuanced understanding and empathy that machines cannot replicate. Human professionals excel in balancing competing project priorities, which often involve managing stakeholder expectations and navigating the complexities of construction logistics (Eber, 2020). The human touch in project management, particularly concerning relationship building and conflict resolution, is crucial for ensuring project goals are met satisfactorily.

As the construction industry evolves, it is increasingly vital for quantity surveyors to develop a hybrid skill set. The combination of technical proficiency in cost engineering with data analysis positions QS professionals at the forefront of innovative project delivery (Rane et al., 2024; Obiuto et al., 2024). Acknowledging the importance of dual roles enables QSs to navigate modern construction project nuances effectively while leveraging AI technologies fully.

In conclusion, the future of quantity surveying lies in a collaborative synergy between human intelligence and AI. As infrastructure developments become more complex, harnessing AI’s advantages while retaining essential human negotiation and stakeholder management skills will be crucial. Evolution signifies a promising future for the QS profession, merging advanced technological innovations with irreplaceable human expertise, ultimately driving successful project outcomes.

 

Setting the Stage for Transformation

The role of the Quantity Surveyor (QS) is undergoing significant transformation, driven by digital evolution within the construction industry. As the profession integrates core QS competencies with advanced AI-driven capabilities, it is paving the way for a new era characterised by enhanced efficiency, accuracy, and strategic influence in project delivery. Integration—melding traditional skills with innovative technology—marks a pivotal moment for QS professionals, particularly in the context of large-scale projects such as the Jakarta Wastewater Treatment Plant (WWTP).

The adoption of Building Information Modelling (BIM) technologies has played a crucial role in transformation. BIM systems enable quantity surveyors to automate time-consuming processes, such as quantity takeoffs, thus significantly accelerating the initial phases of cost estimation and project planning (Ying & Kamal, 2021; Babatunde et al., 2018; Evans et al., 2020). Automation through BIM applications allows QS professionals to utilise real-time data, improving their capacity to provide accurate and timely estimates while minimising the errors associated with traditional methods (“Innovative Changes in Quantity Surveying Practice through BIM, Big Data, Artificial Intelligence and Machine Learning”, 2020; Ogunseiju et al., 2023). Improves workflow efficiency, leading to better resource allocation and project scheduling, which are essential for maintaining timelines and budgets in megaprojects.

Furthermore, the introduction of AI technologies has enhanced these capabilities, facilitating comprehensive data analysis and risk assessment (Jaud et al., 2020; Zhan et al., 2022; Sepasgozar et al., 2022). For example, predictive analytics can identify potential cost overruns or flag indicators of high-risk subcontractor performance before they escalate, leading to proactive measures that improve project management (Fürstenberg et al., 2024; Adesi et al., 2023). Accordingly, a shift towards data-driven decision-making enhances the strategic role of quantity surveyors, positioning them as key players in guiding projects towards successful outcomes.

Despite these advancements, the human element in quantity surveying remains essential. While AI can streamline data processing and expedite document generation, human judgment is irreplaceable in negotiation contexts, interpretation of unique project dynamics, and balancing competing priorities (Ogunseiju et al., 2023). The QS professional must navigate complex interpersonal relationships with contractors, clients, and stakeholders, utilising their expertise to address nuanced concerns and fulfil strategic objectives. A distinctive combination of technical proficiency and interpersonal skills characterises the modern QS as a hybrid professional, equipped to make informed decisions that advance project objectives amid complexity (Babatunde & Ekundayo, 2019; Moyanga & Agboola, 2020).

Additionally, the ongoing digital transformation mandates that quantity surveyors foster a mindset of continuous learning and adaptation. As new technologies and methodologies emerge, professionals must remain agile and informed to maximise the benefits of digital tools and innovations such as AI and BIM (Tanko et al., 2022; Ebekozien & Aigbavboa, 2023). Commitment to lifelong learning is vital as the industry evolves, offering QS professionals opportunities to redefine their roles and enhance their contributions to project delivery (Vakaj et al., 2023).

In conclusion, the future of quantity surveying is promising and full of opportunities. The convergence of traditional QS skills with AI capabilities signals a more efficient, precise, and impactful profession. By embracing digital advancements and nurturing the human-AI partnership, quantity surveyors are poised to drive substantial transformation in ensuring construction projects are completed on time, within budget, and to the highest quality standards. As evolution unfolds, QS professionals will continue to play a pivotal role within the broader construction ecosystem, fundamentally reshaping how professional services are delivered in an ever-evolving landscape.

 

 

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Tanko, B. L., Zakka, W. P., Heng, W. N. (2022). BIM in the Malaysian construction industry: a scientometric review and case study. Engineering Construction & Architectural Management, 31.0(3.0), 1165-1186. https://doi.org/10.1108/ecam-04-2021-0324

Theddy, V., Pranoto, W. A. (2024). ANALISIS PERAN QUANTITY SURVEYOR PADA PROYEK JISC (JATILUHUR INDUSTRIAL SMART CITY). JMTS Jurnal Mitra Teknik Sipil. https://doi.org/10.24912/jmts.v7i1.26672

Vakaj, E., Cheung, F., Cao, J., Tawil, A. H., Patlakas, P. (2023). An Ontology-Based Cost Estimation for Offsite Construction. Journal of Information Technology in Construction, 28.0, 220-245. https://doi.org/10.36680/j.itcon.2023.011

Victar, H. C., Perera, B., Palihakkara, A. D. (2022). The role of the quantity surveyor in achieving a circular built environment at the design stage, 936-948. https://doi.org/10.31705/wcs.2022.75

Victar, H. C., Perera, B., Palihakkara, A. D., Dewagod, K. G. (2023). Roles and competencies of quantity surveyors in achieving a circular built environment: an investigation according to 3R principles. Smart and Sustainable Built Environment, 13.0(4.0), 1015-1040. https://doi.org/10.1108/sasbe-10-2022-0231

Victor, N. O. C. (2023). Optimising Construction Productivity Through Automation and Artificial Intelligence. International Journal of Artificial Intelligence and Machine Learning, 3.0(2.0), 28-44. https://doi.org/10.51483/ijaiml.3.2.2023.28-44

Victor, N. O. C. (2023). The Application of Artificial Intelligence for Construction Project Planning. , 1.0(2.0), 67-95. https://doi.org/10.18178/jaai.2023.1.2.67-95

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Ward, J. M., Dimitriou, H. T., Field, B. G., Dean, M. (2019). The Planning and Appraisal of Mega Transport Infrastructure Projects Delivered by Public-Private Partnerships: The Case for the Use of Policy-Led Multi-Criteria Analysis. Organisation Technology and Management in Construction: An International Journal, 11.0(1.0), 1992-2008. https://doi.org/10.2478/otmcj-2019-0007

Yap, J. B. H., Skitmore, M., Lim, Y. W., Loo, S. C., Grey, J. (2021). Assessing the expected current and future competencies of quantity surveyors in the Malaysian built environment. Engineering Construction & Architectural Management, 29.0(6.0), 2415-2436. https://doi.org/10.1108/ecam-01-2021-0091

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[{‘author_name’: ‘Wan Nor Fa’aizah Wan Abdul Basir’, ‘author_slug’: ‘wan-nor-fa-aizah-wan-abdul-RVkPl3’, ‘author_sequence_number’: ‘1’, ‘affiliation’: None, ‘affiliation_slug’: None}, {‘author_name’: ‘Uznir Ujang’, ‘author_slug’: ‘uznir-ujang-6MrnKM’, ‘author_sequence_number’: ‘2’, ‘affiliation’: None, ‘affiliation_slug’: None}, {‘author_name’: ‘Zulkepli Majid’, ‘author_slug’: ‘zulkepli-majid-Pzxr20’, ‘author_sequence_number’: ‘3’, ‘affiliation’: None, ‘affiliation_slug’: None}] (2023). Adaptation 4D and 5D BIM for BIM/GIS data integration in construction project management. Iop Conference Series: Earth and Environmental Science, 1274.0(1.0), 12002. https://doi.org/10.1088/1755-1315/1274/1/012002

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Broken Governance – Why the 'G' Is the Weakest Link

 

Broken Governance Why the 'G' Is the Weakest Link

1. Introduction to ESG and Governance

1.1 Understanding ESG

Environmental, Social, and Governance (ESG) criteria are a set of standards that socially conscious investors use to screen potential investments (Tohang et al., 2024). Governance, which encompasses a company's leadership, executive compensation, audits, internal controls, and shareholder rights, is foundational to ESG, ensuring transparency, accountability, and integrity within an organization (Alves, 2025). Effective governance structures oversee the implementation of environmental and social policies, ensuring that they lead to meaningful change (Alves, 2025)

Governance Challenges in ESG. Despite its importance, governance is often the most compromised pillar of ESG (Campbell & Kanjilal, 2022). Common challenges include symbolic governance structures that satisfy compliance requirements more than they drive reform, superficial audits, insider-dominated boards, and weak whistleblower protections (Campbell & Kanjilal, 2022). These issues reduce ESG to a performative exercise, where ethics are proclaimed in policy but evaded in practice, undermining the credibility of sustainability efforts (Campbell & Kanjilal, 2022;

1.2 The Role of Governance in ESG

Governance is essential to ESG, ensuring transparency, accountability, and integrity within an organization (Alves, 2025). Effective governance structures oversee the implementation of environmental and social policies, ensuring they lead to meaningful change (Alves, 2025). Governance involves setting clear standards, monitoring compliance, and enforcing ethical practices, thus building trust among stakeholders and promoting sustainable business practices (Alves, 2025).

Symbolic governance structures that exist merely to satisfy compliance requirements rather than drive reform, as well as superficial audits and insider-dominated boards, contribute to "greenwashing." This occurs when companies make misleading claims about their environmental or social impact without implementing meaningful operational changes (Olatubosun & Nyazenga, 2019).

 

1.3 The Importance of Effective Governance

Effective governance structures are crucial for ensuring that environmental and social policies yield meaningful results (Alves, 2025; Governance requires clear standards, compliance monitoring, and ethical practice enforcement, thus enhancing stakeholder trust and driving sustainable practices (Alves, 2025; Strong governance frameworks can improve the credibility and effectiveness of ESG initiatives, aligning them with stakeholder expectations and regulatory standards Moussa et al., 2024).

Research on governance structures and ESG Performance indicates that corporate governance characteristics, including board composition, ownership structure, and executive compensation, have a significant impact on companies' ESG performance (Kang et al., 2022; Yavuz et al., 2024; Bhat et al., 2023). Studies have found that board independence, gender diversity, and the presence of dedicated ESG committees can enhance a company's environmental, social, and governance practices (Kang et al., 2022; Yavuz et al., 2024; Bhat et al., 2023).

1.4 The Role of Stakeholders in Governance

Stakeholders—such as investors, regulators, and civil society organizations—play a critical role in shaping corporate governance and promoting ESG integration (Campbell & Kanjilal, 2022; Olatubosun & Nyazenga, 2019). Effective stakeholder engagement can hold companies accountable for their sustainability commitments and ensure that governance structures are meaningful (Campbell & Kanjilal, 2022; Olatubosun & Nyazenga, 2019). Proper management of stakeholder relationships can enhance the credibility and effectiveness of ESG initiatives (Moussa et al., 2024).

Governance is essential to ESG, ensuring transparency, accountability, and integrity within organizations (Alves, 2025). However, it frequently proves to be the weakest link in ESG, facing challenges such as symbolic governance structures and superficial audits (Campbell & Kanjilal, 2022). Effective governance is crucial for ensuring that environmental and social policies translate into meaningful and lasting changes. Research indicates that the characteristics of corporate governance can have a significant impact on companies' ESG performance (Alves, 2025; Kang et al., 2022; Yavuz et al., 2024; Bhat et al., 2023). Stakeholders play a crucial role in shaping governance and driving the integration of ESG (Campbell & Kanjilal, 2022; Olatubosun & Nyazenga, 2019; Moussa et al., 2024).

 

 2: The Illusion of Governance

2.1 Symbolic Governance Structures

In the realm of Environmental, Social, and Governance (ESG) initiatives, many committees often serve as mere symbolic artefacts rather than robust entities that promote substantive reform. These governance structures often emerge to satisfy compliance requirements rather than effect genuine transformation, as observed across various industries (Machuki & Rasowo, 2018; Mthombeni et al., 2023). The committees often lack sufficient authority and resources to implement effective change, resulting in governance practices that prioritize appearances over tangible outcomes (Zorn et al., 2017). This superficial approach erodes the credibility of ESG efforts, resulting in governance mechanisms that exist in form but do not function, thereby perpetuating a performative exercise rather than genuine accountability.

Symbolic governance undermines trust among stakeholders; when organizations focus on creating the semblance of governance, the essential principles of transparency and accountability are compromised (Rouf & Al-Faryan, 2022). Accordingly, these diluted governance structures foster an environment where ethical misconduct can thrive unchecked, further diminishing stakeholders' confidence in firms' sustainability commitments (Ngwenze & Kariuki, 2017). Thus, businesses risk devolving into mere optics-driven organizations, where compliance reports showcase adherence while actual practices diverge significantly from stated values.

2.2 Superficial Audits and Compliance

An additional vulnerability within ESG frameworks lies in the superficial nature of compliance audits. These audits often prioritize cosmetic compliance over genuine scrutiny, focusing primarily on ticking boxes rather than conducting a critical examination to identify and address systemic issues within organizations (Lanis et al., 2020; Samara & Berbegal-Mirabent, 2017). This lack of rigour in auditing contributes to a dangerous trend: it allows unethical practices to persist and proliferate unchecked, significantly impairing the effectiveness of governance mechanisms.

Moreover, organizations operating under the guise of compliance face increased reputational risk when stakeholders begin to perceive them as disingenuous. The reliance on ceremonial audits can create a false sense of security, as the absence of substantial corrective measures generates myths of accountability while actual governance practices remain ineffective (Singh et al., 2023). Consequently, the conflation of form and function in audit processes creates an environment where organizations can engage in practices that are at odds with their proclaimed values, further reinforcing the disconnect between governance rhetoric and reality.

2.3 Insider-Dominated Boards

The governance challenges extend to the composition of corporate boards, which are responsible for guiding environmental, social, and governance (ESG) strategies. Many boards are dominated by individuals from executive, financial, or consultancy backgrounds, creating an echo chamber that stifles diverse perspectives and insights essential for addressing the multifaceted social and environmental challenges of ESG (Pareek et al., 2019; Jiménez et al., 2020). This insider dominance raises concerns about the disconnection between governance decisions and the realities faced by communities and ecosystems that ESG initiatives aim to support.

As a result, governance decisions often prioritize the interests of investors over those of vulnerable populations that are adversely affected by corporate operations. This dynamic is detrimental to effective governance as it reinforces existing power imbalances and limits the exploration of alternative, more inclusive approaches to sustainability. Moreover, the lack of independent voices on boards may result in decisions that reflect narrow perspectives rather than the nuanced understanding required to engage with complex social and environmental issues effectively (Mishra & Kapil, 2018).

2.4 Lack of External Scrutiny

The internal governance frameworks of many organizations often escape adequate external scrutiny, compounding the problems noted earlier. Weak whistleblower protections and a lack of binding shareholder votes on sustainability initiatives lead to a self-regulated environment, fostering conditions where unethical practices can thrive (Etale & Tueridei, 2020; Gantenbein & Volonté, 2019). In this atmosphere, the absence of critical oversight weakens accountability mechanisms and hinders the overall effectiveness of governance, ultimately undermining trust in ESG efforts.

The gap left by underfunded regulatory bodies and disengaged shareholders further magnifies this problem. Without proper checks and balances, organizations often prioritize self-serving practices over genuine stakeholder engagement and responsiveness. The absence of external checkpoints leads to governance structures that fail to fulfil their essential roles, ultimately resulting in a crisis of credibility surrounding ESG initiatives.

2.5 Weak Whistleblower Protections

Moreover, the existing framework supporting whistleblower protections within ESG governance remains inadequate, leaving individuals vulnerable to retaliation if they report unethical practices. This weakness significantly discourages employees and stakeholders from voicing concerns, creating an environment in which governance gaps persist without recourse to accountability. Consequently, the silencing of internal accountability mechanisms can erode external trust in organizations and fuel the perception of failure in governance frameworks.

When individuals fear reprisals for reporting misconduct, the alignment between governance intentions and actual performance is jeopardized, as organizations risk undermining their ethical foundations. The overall Effect of inadequate protections fosters a culture of silence rather than one of accountability and transparency, ultimately contributing to weak governance systems incapable of instilling confidence among stakeholders.

2.6 The Transparency Gap and the Assurance Illusion

Ultimately, even when governance frameworks are superficially established, a deeper underlying issue arises—the "transparency gap." Many organizations produce ESG data that is unaudited, undocumented, and unverifiable, complicating any efforts toward genuine oversight. The absence of internal controls, third-party reviews, and effective integration of ESG into audit cycles exacerbates this transparency deficit, leading to questions about the credibility and reliability of reported information.

Without robust mechanisms to verify governance practices and promote assurance, firms expose themselves to significant reputational and financial risks. The illusion of governance created through unverified data further distorts stakeholder perceptions of organizational integrity and commitment, further entrenching the disparity between promises and actual practices. This scenario necessitates a critical reevaluation of how governance frameworks are designed and implemented to ensure alignment between stated objectives and actual outcomes.

Conclusion

The illusion of governance within corporate structures presents significant challenges to the efficacy of ESG initiatives. Symbolic governance structures, superficial audits, insider-dominated boards, lack of external scrutiny, weak whistleblower protections, and transparency gaps all contribute to a precarious landscape for organizations attempting to navigate the complexities of sustainability and ethical responsibility. To cultivate genuine accountability and foster transformative governance practices, organizations must address these weaknesses and strive for a meaningful integration of ESG principles into their core operational frameworks.

 

Chapter 3: Exclusion by Design

3.1 Elite-Centric Governance

A significant flaw in Environmental, Social, and Governance (ESG) governance structures is their elite-centric architecture. Corporate boards are often predominantly composed of individuals with backgrounds in executive positions, finance, or consulting. This oligarchic composition disconnects leadership from the realities faced by communities and environments that ESG initiatives purport to address (Chandrakumara et al., 2017); (Carter et al., 2010; . As a result, governance becomes relegated to a select few who may lack the requisite real-world understanding of the social and ecological challenges at hand, thereby fostering governance blind spots (Chandrakumara et al., 2017); (Carter et al., 2010;

Moreover, the tendency of these boards to prioritize shareholder interests can lead to policies that overlook or harm the communities affected by corporate activities. By favouring the perspectives and priorities of the elite over those of marginalized populations, these governance structures may exacerbate social inequality and environmental degradation rather than mitigate them (Terjesen & Singh, 2008). In essence, ESG governance, designed to promote sustainability and social equity, may inadvertently serve the interests of a narrow power base, further entrenching existing inequities (Morad, 2017; Nielsen & Huse, 2010).

3.2 Homogeneity in Board Composition

The homogeneity of corporate boards represents another critical aspect of governance failure within ESG frameworks. When boards consist of members who share similar educational and socio-economic backgrounds, they are more likely to overlook diverse perspectives necessary for effective governance (Terjesen & Singh, 2008; Damoah et al., 2021). This lack of diversity can lead to detrimental governance blind spots, as policies will primarily be formulated in elite boardrooms isolated from the realities of supply chain abuses, community displacement, and labour exploitation that occur outside these environments (Veres, 2019).

Furthermore, this sameness fosters a culture where decisions closely align with investor priorities, frequently sidelining the interests of populations most vulnerable to corporate actions. Aligning governance practices primarily with the priorities of a homogeneous group can create systemic failures in addressing environmental, social, and corporate governance concerns effectively. The resultant policies often fail to resonate with or address crucial challenges facing affected communities, perpetuating a cycle of neglect and disconnection (Carter et al., 2010; Veres, 2019).

3.3 Tokenistic Inclusion

In instances where inclusion is attempted, it often manifests as tokenistic representation rather than genuine integration. For example, boards might include a single woman or a minority representative primarily as a symbolic gesture meant to exhibit progress without reorienting the distribution of power (Kathuria & Dash, 1999; Reverte, 2009). This facade of inclusivity can sustain systems of exclusion, undermining trust among stakeholders and exacerbating accountability gaps within the ESG framework (Khaoula & Ali, 2012).

True inclusion involves not just diversifying representation but empowering diverse voices to co-create policies, standards, and governance mechanisms that genuinely reflect the needs of all stakeholders. Tokenistic practices can lead to superficial compliance with diversity mandates while failing to engender substantive engagement or change (Kemp, 2006). When diversity becomes merely decorative rather than a catalyst for decision-making, the risks associated with governance blind spots persist, ultimately diminishing the effectiveness of ESG strategies (Kathuria & Dash, 1999; Imran & Shafique, 2022).

3.4 Governance Blind Spots

Governance blind spots manifest when decision-makers lack the necessary diverse perspectives and lived experiences to formulate effective policies. When boards primarily composed of elite insiders steer ESG initiatives, key issues such as supply chain abuses and labour exploitation often go unaddressed, resulting in policy frameworks misaligned with the reality on the ground (Benkraiem et al., 2017) (Malelak et al., 2020). Consequently, these blind spots can undermine the efficacy of governance and risk-reducing ESG aspirations, rendering them simple performative exercises devoid of real influence or impact.

Moreover, inadequate stakeholder mapping exacerbates these gaps, making it challenging for organizations to identify and engage with communities most affected by their decisions (Younas et al., 2019). This lack of comprehensive understanding jeopardises the organisation's ability to enact responsible governance and erodes trust among stakeholders, who may feel ignored or marginalised (Benkraiem et al., 2017). Enhancing governance through diverse perspectives is essential for recognizing and mitigating the risks inherent in isolationist decision-making processes.

3.5 Disconnect from Affected Communities

An alarming disconnect between corporate governance structures and impacted communities complicates the implementation of ESG. Corporations frequently neglect to incorporate feedback from workers, residents, or civil society during the decision-making processes that profoundly affect them (Carter et al., 2003) (Muniandy, 2022). This oversight not only undermines the credibility of ESG efforts but also fosters an environment where trust is lost, widening the accountability gap.

The lack of effective feedback loops that guide risk and impact strategies highlights the ineffectiveness of current governance practices (Badru et al., 2019; Leatherwood & O'Neal, 1996). When governance mechanisms operate in isolation from the voices of affected stakeholders, the likelihood of enacting sustainable and ethical policies diminishes significantly (Carter et al., 2003). Building genuine relationships with these stakeholders is essential to aligning corporate governance with the realities of their environments, fostering greater corporate responsibility and self-awareness that prioritizes ESG objectives.

Conclusion

The architecture of ESG governance is inherently flawed due to its elite-centric design, lack of diversity, and a tendency toward tokenism. These structural deficiencies perpetuate blind spots in governance and create disconnects between decision-makers and the communities they impact. By addressing these issues—promoting genuine inclusivity, fostering board diversity, and ensuring robust stakeholder engagement—corporate governance can move beyond performative ESG commitments to create impactful and sustainable change. Strengthening pathways for diverse voices in governance is crucial for mitigating exclusionary practices and fulfilling the objectives of social and environmental responsibility embedded in ESG frameworks.

Chapter 4: Rebuilding Governance

4.1 From Voluntary to Statutory Compliance

To restore the integrity of Environmental, Social, and Governance (ESG) practices, the shift from voluntary, self-directed compliance to statutory obligations is crucial. Governments must implement and enforce laws that mandate environmental and human rights due diligence, compelling companies to undergo independent third-party audits. Such a legislative framework is necessary to ensure that corporate decisions transcend mere symbolism and lead to tangible, meaningful changes that build trust among stakeholders (Favotto & Kollman, 2021; Lafarre & Rombouts, 2022; Li, 2023).

Statutory compliance serves as a foundational pillar that elevates ESG initiatives from optional practices to enforceable responsibilities. By instituting legal obligations, companies are incentivized to adopt a genuine commitment to environmental stewardship and social responsibility rather than treating compliance as a cursory task (Crosby, 2018). This legal infrastructure not only paves the way for accountability but also aligns corporate actions with societal expectations, cultivating an environment conducive to sustainable business practices (Li, 2023; Dehbi & Martin‐Ortega, 2023). By enhancing enforceability through such laws, the ESG landscape can evolve, ensuring that businesses operate responsibly while safeguarding human rights and the environment.

4.2 Legal Oversight and Third-Party Audits

The effectiveness of governance in ESG contexts hinges upon rigorous legal oversight and third-party audits. Emerging frameworks, such as the European Union's Corporate Sustainability Reporting Directive (CSRD) and France's Duty of Vigilance Law, illustrate how statutory obligations can mandate accountability across entire supply chains, thereby ensuring ethical practices throughout organizational operations (Buttke et al., 2024); (McGaughey et al., 2021; Savourey & Brabant, 2021). These laws promote transparency and accountability, significantly enhancing the credibility of corporate Environmental, Social, and Governance (ESG) initiatives.

Notably, implementing legally mandated assurance and independent audits transforms the scope of ESG disclosures, no longer relegating them to mere narratives but requiring them to meet audit-level scrutiny (McGaughey et al., 2021). Consequently, companies that adopt these frameworks are more likely to embed ESG considerations into their internal audit plans, establish formal controls, and collaborate with third parties for the verification of disclosures (Buttke et al., 2024; Savourey & Brabant, 2021). As businesses transition to evidence-based leadership, the likelihood of achieving genuine progress toward sustainability and social equity increases significantly, countering the performative actions that often characterize ESG initiatives.

4.3 Integrating Civil Society into Governance

The active integration of civil society, including non-governmental organizations (NGOs), labour unions, Indigenous communities, and youth organizations, into governance structures is essential for fostering genuine engagement and co-creating policies that reflect systemic equity (Kaufman et al., 2022; Fletcher et al., 2022). By valuing diverse perspectives within corporate governance, the decision-making process shifts away from solely profit-driven logic toward more inclusive practices that effectively address environmental and social challenges (Styhre, 2018).

Civil society can serve multiple roles, including that of a watchdog, co-architect of policies, and accountability partner. The firsthand knowledge and experience of community representatives can substantially inform better governance outcomes, ensuring that policies resonate with the realities faced by marginalized and affected populations (Galani, 2025; Walton, 2022). This collaborative approach is particularly suitable for governance models that prioritise social equity and environmental justice, ultimately leading to more legitimate and effective organisational practices that enhance stakeholder trust (McGaughey et al., 2021; Hughes, 2020).

4.4 Community-Led Governance Initiatives

Community-led governance initiatives provide a promising framework for addressing evolving governance challenges. Such initiatives often include local monitoring mechanisms, stewardship councils, and partnerships that prioritize the voices of communities directly affected by corporate decisions (Stoyanova, 2019; Hill, 2020). Moreover, these grassroots governance structures provide a platform for communities to actively engage in determining their priorities and championing their values, thereby challenging traditional top-down governance models prevalent in corporate settings.

The empowerment of local groups also underscores the moral and political dimensions of governance, as they cultivate a culture of responsibility toward the environment and society (Emerson, 2018). These community-driven models demonstrate that effective governance is not merely a technical endeavour but a commitment to reflecting the needs and aspirations of those most directly affected by corporate activities. By fostering relationships built on mutual respect and collaboration, companies can diminish power imbalances and create more equitable systems of governance (Bhattacharya et al., 2019;

4.5 Ensuring Diverse Perspectives in Decision-Making

Incorporating diverse perspectives within corporate decision-making is paramount for effective governance. Ensuring that corporate boards include individuals from varied backgrounds—including Indigenous leaders, grassroots activists, and representatives from labour unions—enriches the dialogue around essential governance issues (Muñoz & Kroepfly, 2020; Kovač, 2020) (Savourey & Brabant, 2021). This diversity is crucial for shaping policies that comprehensively address the intersections of social, environmental, and economic challenges, ultimately leading to governance practices inclusive of the priorities of the most vulnerable populations.

Fostering representation in governance positions helps break down systemic barriers and address governance blind spots that often overlook the needs of marginalized groups (Bhattacharya et al., 2019; Kovač, 2020). Elevating the voices of previously marginalized individuals not only enhances the quality of corporate governance but also instils confidence among stakeholders in the organization's commitment to social responsibility and justice. A truly diverse decision-making framework positions corporations to respond adeptly to the complexities of today's global challenges, ensuring that governance reforms are deeply rooted in the lived experiences of various stakeholders (Muñoz & Kroepfly, 2020; Savourey & Brabant, 2021).

Conclusion

To rebuild governance within the ESG context, a multifaceted approach is required. Transitioning from voluntary to statutory compliance establishes a foundation for accountability, while legal oversight and third-party audits ensure transparency and adherence to ethical practices. Integrating civil society into governance structures enhances representation and fosters inclusive decision-making. Community-led initiatives highlight the moral responsibilities of governance, emphasizing the importance of local engagement and contextual understanding. Ultimately, incorporating diverse perspectives within corporate boardrooms is crucial for developing policies that genuinely reflect the needs and values of the affected communities. As governance evolves in response to these challenges, organizations stand to gain not only increased legitimacy and trust but also more effective practices that align with the United Nations' Sustainable Development Goals.

 

Chapter 5: Case Studies of Successful Governance Reforms

5.1 European Union's Corporate Sustainability Reporting Directive (CSRD)

The European Union's Corporate Sustainability Reporting Directive (CSRD) represents a pivotal governance reform that mandates corporate accountability throughout the value chain. By requiring companies to produce detailed reports and undergo third-party audits, the CSRD enhances accountability within corporate frameworks. This legislative evolution shifts the approach to governance from one based on voluntary self-reporting to one that mandates transparency, compelling companies to demonstrate a genuine commitment to sustainability rather than merely engaging in performative actions (Tsalis et al., 2020).

Through these regulations, the CSRD ensures that ESG metrics are now held to the same rigorous standards as traditional financial statements, requiring robust controls, traceability, and verifiability (Puriwat & Tripopsakul, 2023). The initial requirement for "limited" assurance transitions into the expectation for "reasonable" assurance, corresponding to a higher level of oversight and authenticity in reporting practices. As a result, companies that prepare for audit readiness are positioned favourably, gaining not only compliance advantages but also enhanced market credibility and stakeholder trust. This regulatory-grade transparency aligns corporate strategies with broader societal expectations for sustainability and ethical governance, demonstrating a significant shift in how organizations are held accountable for their environmental, social, and governance (ESG) commitments.

5.2 France's Duty of Vigilance Law

France's Duty of Vigilance Law stands as another exemplary case of progressive governance reform, mandating companies to create and enforce vigilance plans aimed at identifying and preventing human rights abuses and environmental damage within their supply chains (Niu & Wang, 2024). This law exemplifies the importance of legal oversight by requiring corporations to take concrete steps to assess and mitigate potential adverse impacts on human rights and the environment, building a systematic framework for accountability.

By instituting third-party audits and clear compliance expectations, the Duty of Vigilance Law not only elevates governance standards domestically but also sets a national benchmark that has the potential to inspire similar measures globally (Lee, 2024). This law's emphasis on proactive identification and prevention poses a significant challenge to companies, urging them not only to comply with existing regulations but also to innovate their approaches to governance and risk management. Ultimately, the Duty of Vigilance Law strengthens the link between corporate operations and ethical obligations, reinforcing a culture of responsibility that serves as a model for other nations considering similar legislation.

5.3 Community-Led Governance Initiatives

In various contexts, community-led governance initiatives have emerged as effective models for addressing governance challenges by directly involving local groups in the development and implementation of policies (Grisales & Aguilera‐Caracuel, 2019). These initiatives often incorporate mechanisms such as monitoring frameworks, stewardship councils, and sustainability partnerships, which emphasize the importance of legitimacy and community involvement in governance processes (Xie et al., 2018).

Community-led governance demonstrates that effective governance is not merely technical but deeply moral and political, prioritizing the needs and values of affected communities (Tang et al., 2024). By actively integrating civil society organizations, labour unions, Indigenous communities, and youth groups into these governance frameworks, community-led initiatives ensure that a diverse array of perspectives informs corporate decisions and that systemic inequalities are effectively addressed (Sekaran et al., 2023). Such participatory approaches showcase the benefits of collective agency in governance, transforming traditional decision-making paradigms into processes characterized by co-creation, mutual ownership, and shared accountability. The resulting policies not only gain broader acceptance but also serve as more effective solutions to complex social and environmental challenges.

Conclusion

The case studies of the CSRD, France's Duty of Vigilance Law, and successful community-led governance initiatives collectively highlight significant strides in establishing accountability and ethical practices within the realm of ESG governance. By embedding statutory obligations, leveraging community engagement, and prioritizing diverse perspectives, these reforms move beyond superficial compliance to promote genuine sustainability and social equity. These examples underscore the need to evolve governance frameworks to address contemporary challenges and foster an inclusive, responsible business environment that reflects the values and needs of diverse stakeholder groups.

 

Chapter 6: Conclusion and Call to Action

6.1 The Need for Structural Change

For Environmental, Social, and Governance (ESG) practices to realize their transformative potential, a fundamental structural change in governance is imperative. This evolution necessitates a reevaluation of who governs, the processes of decision-making, and the core values that underpin these decisions. By addressing the root causes of weak governance, organizations can foster a more transparent, accountable, and inclusive system that aligns with sustainable business practices Olorunyomi et al. (2021) (An & Kwak, 2024). This approach emphasizes addressing foundational issues—not just the visible symptoms—of broken governance.

Structural change in the governance of ESG practices is not merely a procedural adjustment but a reevaluation of the normative frameworks that guide corporate conduct. It calls for discarding outdated models that prioritize shareholder interests over community welfare, thereby enabling a governance system that genuinely reflects stakeholder concerns and promotes ethical decision-making (Joy, 2024). Such sweeping changes will pave the way for ESG to emerge as a significant contributor to long-term sustainability, ensuring that corporate governance aligns more closely with the challenges of current social and environmental realities (Pratiwi & Edeh, 2024).

6.2 Genuine Stakeholder Engagement

Genuine stakeholder engagement is pivotal for effective governance. This principle emphasizes the need to actively involve diverse voices, including employees, local communities, and civil society, in the decision-making process. Beyond mere consultation, organizations must ensure that all stakeholders have a tangible influence on governance to build trust and foster collaboration (Kossay et al., 2025). By facilitating comprehensive participation, companies can develop policies and initiatives that reflect the actual needs and values of the populations most affected by their actions.

Moving from performative to participatory ESG governance is essential; organizations must view stakeholder participation not as a mere checkbox exercise but as an integral component of their governance framework (Ilori et al., 2023). This paradigm shift enriches governance practices, ensuring that decisions are informed by the diverse contexts in which businesses operate. By genuinely integrating stakeholder insights and feedback into governance structures, companies can foster stronger relationships with their communities, mitigate risks associated with reputation damage, and enhance their legitimacy (Shapira, 2023; Handoko et al., 2024).

6.3 Enforceable Accountability

Ensuring enforceable accountability stands as a critical pillar for strengthening governance practices associated with ESG. This concept centres on establishing legal standards and independent oversight mechanisms that hold organizations accountable for their actions and commitments. Transitioning beyond voluntary compliance to enforceable obligations requires a substantial paradigm shift, ensuring that ethical practices are not merely proclaimed in policy but effectively enforced in actual operations (Hutauruk et al., 2025).

The implementation of legal frameworks and third-party audits, as exemplified by regulations such as the European Union's Corporate Sustainability Reporting Directive (CSRD) and France's Duty of Vigilance Law, exemplifies the trajectory toward enforceable accountability (Borolla et al., 2025; Junxuan, 2025). By instituting legally binding obligations, corporate governance can evolve into a robust system that demands adherence to ethical guidelines and sustainability targets. This transition will significantly enhance corporate accountability, ensuring that organizations cannot neglect their responsibilities without facing tangible consequences.

6.4 Moving Beyond Corporate Theatre

To move beyond corporate 'theatre' in governance, it is necessary to transition from performative protocols to participatory power structures. This shift requires the replacement of symbolic gestures with genuine reforms that bring about meaningful change. Focusing on transparency, accountability, and inclusivity will allow organizations to transform governance from a tool for public relations into a dynamic force for justice and positive impact (Li, 2025; Chopra et al., 2024).

Moreover, avoiding superficial engagements will drive authentic commitments to ESG values, prompting businesses to embody the principles of social responsibility and environmental stewardship in meaningful ways. Stakeholders are increasingly demanding greater sincerity and action from corporations regarding their ESG commitments; organizations must respond by embedding these principles into their strategic frameworks rather than relegating them to mere marketing gestures (Park et al., 2024; Плетенская, 2025). Ultimately, genuine engagement with communities lays the foundation for trust and cooperation, guiding organizations toward shared goals of sustainability and equity.

6.5 Governance as a Dynamic Force for Justice

Governance must be reimagined as a dynamic force for justice, grounded in principles of transparency, accountability, and participatory power. Achieving this transformation necessitates systemic change, authentic stakeholder engagement, and enforceable accountability measures (Liang, 2024; Adebıyı et al., 2024). By embracing these core principles, organizations can establish governance systems that not only uphold ethical standards but also actively promote sustainable and equitable business practices.

Reconstructing the 'G' in ESG as the moral engine of the framework—bold, inclusive, and responsive—will empower organizations to navigate today's socio-environmental challenges effectively. The proactive reformation of governance structures into mechanisms that foster justice will bridge the gap between rhetoric and reality, ensuring that ESG principles translate into substantial changes that benefit both society and the planet (Amosh, 2025; Yan, 2024). By championing a governance model that solidifies the foundation of ESG, organizations will foster lasting positive change and enhance their relevance in an increasingly conscientious marketplace.

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