Our experience with clients shows that we have 2 main types of organisation which approach us looking for governance support.
Most of our clients practice good governance. They engage Leading Governance to help take their governance from good to great. These clients recognise the value of good governance to their organisation. They are clear about the roles and responsibilities of the board and senior management team. They have a clear vision, and set organisational objectives. They regularly monitor performance. They know what their key risks are, and manage these appropriately. They ensure the right mix of skills and experience on the board and promote a positive culture. These organisations tend to be well run, with good stakeholder involvement and financial stability.
On the other end of the spectrum, we are sometimes approached by boards in crisis. It could be that they have buried their heads in the sand about organisational performance, have recently uncovered financial improprieties, do not manage conflicts of interest or have board members without the skills to ensure the organisation is operating legally and safely. In these cases, directors often assume they have limited liability and don’t realise that if they have not properly discharged their duties as company directors, they may be liable for financial or legal penalties up to and including prosecution.
The reason I’m talking about this is not to scare people off becoming company directors, but to appeal to the silent majority of board members in organisations which are doing OK to review and constantly develop their governance procedures. If you are regularly thinking about how governance might be improved, you are more likely to know existing systems and processes.
When boards focus on governance, they start to promote a culture of putting key stakeholders at the centre of the planning process, using money wisely to deliver agreed objectives, and leading successful organisations. This is therefore an appeal for all board members to strive to be part of the ‘good to great’ group of clients, and avoid slipping into the dangerous waters of being in the ‘crisis management’ group. Not only will you be better protected financially and legally, but you’ll also be a lot less stressed, and enjoy your time as a board member much more!
Some useful reading –
- The Oxford Handbook of Corporate Governance
- Corporate Governance: Principles, Policies, and Practices
- Corporate Governance and Accountability
- Corporate Governance: Law, Regulation and Theory
See more of our recent blog posts below!
- Sample Policy on Board Only meetings
- Annual Review Process – What you need to know
- If You’re Leading From The Boardroom – Tell Everyone
- Imposter Syndrome
- Why is it important for a Board to stay in its Role?
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