LEGAL DEPARTMENT CUMENT IN ESG: THE CORE FOUNDATION OF CORPORATE GOVERNANCE

As ESG increasingly becomes a critical standard in modern management, the “G” (Governance) element goes beyond processes or organizational structure—it reflects how a business makes decisions, manages risks, and operates transparently.

At the seminar titled “Don’t Start from the Standards,” organized by Social Golden Time in collaboration with Golden Solution, Lawyer Nguyen Thuy Dung – Managing Attorney of BNA Legal – shared in depth perspectives on the role of legal affairs within ESG, especially in building a strong foundation for corporate governance.

What is Governance, and Why Are Legal Department the Core of It?

In the ESG framework, Governance is not simply about “having procedures,” but about how a company operates those systems in a transparent and effective manner.

Accordingly, legal department play a central role in ESG by helping businesses:

• Identify and control legal risks
• Ensure compliance with legal regulations
• Build clear internal processes
• Support decision-making aligned with the legal framework

Legal department are not just a “control department” but a strategic partner in corporate governance.

The Role of Legal Department in ESG Governance

In practice, many companies still view legal affairs as the department responsible for resolving problems after risks have already occurred. However, this reactive approach often leads to passive management and increased costs.

Instead, when a legal department is empowered correctly, it can:

• Proactively prevent risks from the outset
• Participate in building governance systems
• Standardize operational processes
• Ensure transparency and consistency

This is particularly important as ESG requires businesses not only to “comply” but to manage effectively and sustainably.

When Should Legal Department Be Involved in ESG?

A common mistake is involving legal department only after systems are completed or when issues arise.

For ESG to be truly effective, legal affairs must be involved from the very beginning.

This helps:

• Identify risks early during the development phase
• Ensure processes are legally compliant
• Minimize future modification costs
• Improve overall operational efficiency

Legal Department – The Foundation of Transparent and Sustainable Governance

Insights shared at the seminar highlight a clear trend: Legal department are no longer the “final step” but the foundation of corporate governance.

Within ESG—especially in the Governance component—legal affairs help businesses:

• Not only operate “according to the law”
• But operate the right way

This is the key factor enabling businesses to grow sustainably in an increasingly complex business environment.