In order for a business to remain viable and sustainable it needs to be able to demonstrate resilience, ensure compliance with relevant regulations and authorities, successfully manage risks and allocate resources appropriately.
By neglecting these key fundamentals of governance, a business could face potential negative impacts on their business operating model as well as their future growth and positioning.
The following principles provide a solid foundation for an effective and efficient governance framework for any business. The principles below are documented for a company structure and will also apply equally to the Board or Committee of an Incorporated Association or the Partners of a Partnership.
a. Responsibility — the Board of Directors is ultimately responsible and accountable for the decisions and actions taken by the business;
b. Independence — independence is key for each director and is demonstrated by a Board that discharges its review and oversight role effectively and independent
of any overarching interests of dominant shareholders, management, and competing or conflicting business interests;
c. Renewal — a policy of Board renewal provides for fresh insight and general reinvigoration of a Board while also ensuring ongoing effective oversight and understanding of the business by the Board;
d. Expertise — demonstrated by a broad range of skills on the Board with the necessary collective expertise to fulfil its required role and functions, and from time to time as and when required access to independent expertise not readily available amongst the current directors;
e. Culture — the culture of the business is set by the ‘tone at the top’ and cascades positively through the business. Everyone involved in the business demonstrates the agreed culture and values;
f. Diligence — demonstrated by a Board that discharges its duties and responsibilities carefully, efficiently and conscientiously;
g. Prudence — demonstrated by a Board with a clear focus on the prudent management of the business operations and does so through reliance on appropriately skilled and talented management;
h. Transparency — demonstrated by a Board that is open and honest in its dealings on behalf of the business and all of its stakeholders; and
i. Oversight — demonstrated by a Board that is able to satisfy itself that the management and operation of the business operations conforms to the Board’s strategy, direction and policies.
Common causes of poor governance & risk management outcomes include the following:
The team at Donovan Oates Hannaford have the expertise and compassion required to listen, advise and guide you in the process of preparing and executing relevant governance and risk management practices.
We can also help you prepare critical strategic and aligned operational planning to help you reduce risk and improve business performance.