208 Specific responsibilities towards need for resilience.

In addition to the inclusion of social and ecological interests in the general responsibilities of the board, legal developments increasingly allocate specific responsibilities to the board for systemic risk management and supply chain due diligence. This allocation allows boards to gain a systemic understanding of the interdependence between their enterprise and its environment. Meanwhile, the extension of board responsibilities to broader social and ecological aspects involved in their operating enterprise challenge the nature of risk-taking by corporations and the legitimate boundaries of board responsibilities. In my view, the ecosystem perspective offers a valuable approach towards overcoming these issues. By focusing on the embeddedness of corporate enterprises in larger ecosystems, the ecosystem perspective provides the notion of resilience in corporate governance. Due to their systemic embeddedness, the continued performance of corporations depends on the resilience of their environment to continue providing the ecosystem services on which their enterprises (and others) depend. As a consequence, corporate activities should not threaten this resilience of larger ecosystems to preserve themselves and to adapt to any changes.

In relation to systemic risks, I therefore recommend that boards should assess whether the systemic risks caused by their enterprise threaten the resilience of their larger environment to continue providing the ecosystem services on which their enterprise and others depend. In relation to the boundaries of their due diligence, I recommend that boards should similarly determine whether their due diligence processes capture and monitor all aspects that are relevant for preserving the resilience of both their corporate ecosystem and the larger ecosystem in which they are embedded. By considering the corporate enterprise as the focal point of analysis, the boundaries of board responsibilities can be established while remaining open to the needs and limits of its environment.