Governance is no longer confined to board composition, policy manuals, or regulatory compliance. In its modern sense, governance reflects how organizations allocate power, manage systemic risks, and build long-term institutional resilience. Viewed through this lens, the care economy is not merely a social concern, it is a core governance issue.
The care economy encompasses both paid and unpaid activities that sustain human capital: childcare, eldercare, mental health support, workplace flexibility, and the fair valuation of care-intensive roles. These factors directly influence workforce stability, productivity, ethical labor practices, leadership continuity, and operational sustainability. When organizations fail to recognize care-related dependencies, they create structural blind spots in governance and risk management frameworks.
Some companies have begun to acknowledge this at a governance level. For instance, organizations such as Salesforce have explicitly linked employee wellbeing and caregiving support to workforce risk management and long-term performance. Rather than treating care as a discretionary benefit, it is positioned as a lever for reducing attrition, sustaining leadership pipelines, and protecting institutional knowledge. Similarly, firms like PepsiCo and Adobe have embedded childcare and family-support mechanisms into broader talent governance decisions recognizing that diversity goals, succession planning, and continuity risks cannot be addressed in isolation from caregiving realities.
Despite these examples, most ESG frameworks and assurance models continue to classify care-related issues as part of the “S” in ESG, often framed as cultural or welfare initiatives. This categorization understates their material impact on governance outcomes.
The Audit Blind Spot: Where Internal Auditors Fall Short
Internal audit and ESG assurance functions typically focus on three areas:
- Existence of policies (HR manuals, DEI statements, wellness programs),
- Headline metrics (attrition, diversity ratios, absenteeism),
- Regulatory compliance.
What is frequently missing is systems-level thinking around care. Auditors rarely examine whether organizational design, performance expectations, and incentive structures are compatible with caregiving responsibilities. As a result, governance assessments fail to capture risks arising from burnout, invisible unpaid care labor, and the silent erosion of leadership pipelines.
Key governance questions often go unasked:
- Do promotion and evaluation systems unintentionally penalize caregivers?
- Is mental health monitored as an enterprise risk indicator or treated as an HR initiative?
- How resilient is the organization to workforce disruption driven by care stress?
When these questions are absent, ESG assurance becomes descriptive rather than diagnostic.
Reframing Care as a Governance Risk
Repositioning the care economy within the “G” of ESG requires boards and audit committees to recognize care as a material governance variable. Just as cyber risk, regulatory exposure, or supply-chain fragility demand oversight, so do caregiving dependencies that shape decision-making capacity and organizational resilience.
For internal auditors, this means expanding audit scopes beyond policies and metrics to include incentive structures, decision-making biases, and resilience planning. When care is properly integrated into governance, organizations are better positioned to retain talent, manage risk proactively, and deliver sustainable long-term value.
In short, governance that ignores care is incomplete and increasingly indefensible.
About the author:
Harsha Ramnani, is a Fellow Chartered Accountant (FCA), Registered Valuer (Securities & Financial Assets – IBBI), with over 15 years of post-qualification experience, she provides strategic leadership, quality oversight, and risk governance across complex statutory audits, ESG & BRSR Core assurance, IND-AS/IFRS transitions, valuation advisory, and multi-jurisdictional due-diligence engagements.
She is among the first Social Auditors in Rajasthan and a published author of ICAI technical guides and ESG background materials. She has also served as a facilitator on a World Bank–funded public sector audit system implementation project. In her professional role, she leads client strategy, mentors senior teams, and engages with boards, regulators, and public institutions to drive governance-led, assurance-focused outcomes.
She is a regular faculty for Valuation, BRSR, Internal Audit and Social Impact Assessment course, and a trainer for ICAI orientation as well as management and communication programs, with international exposure and investigating authorities handled across India, USA, EU, Turkey, Bahrain, Kingdom of Saudi Arabia, Russia, Pakistan, Oman, and China.