Moving towards a new framework for the relationship between employers and workers

While organisations are encouraged to pay attention to their impact on society, the focus is often on their core business activity rather than the external impact of their workforce practices. This report examines how the impact of workforce practices, such as diversity and excessive executive remuneration, can be shaped by governance regulation and organisational decision-making.

This working paper, Moving towards a new framework for the relationship between employers and workers, provides a framework for developing a set of recommendations for executive directors and HR leaders. It calls for senior leaders to include the social impact of workforce policies and practices in high-level discussions about what the purpose, strategy and values of the business should be. The working paper poses two questions:

Should governance regulation, such as the FRC Provisions and Guidance, include the following topic for senior management: do our workforce policies and practices support or damage our social legitimacy?
Should senior management set the ‘tone at the top’ to empower management to mitigate this risk?

While this paper is based on the UK context, the broader principles should be of interest wherever you are based.

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Moving towards a new framework

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