Governance of boards is a vital structure for corporations to succeed. It combines tried-and-true principles with best practices that allow boards to deal with complexity and take their organizations to the next level.
A set of clear guidelines establishes the direction of a company, ensures compliance, and offers guidance for managing risk. It sets the foundation for corporate culture and accountability. Good governance is not easy, especially when there are many things at stake. That’s why we’ve gathered our top governance tips for boards to help you build ethical, efficient and profitable organizations.
Identify a strategic agenda for the future
One of the most important things a well-governed board does is create a comprehensive plan for the future. This gives directors a direction and ensures that their time is spent in a manner that is most beneficial to the company. This could include establishing an organization-wide leadership program to train the future generation of board leaders.
Establish a Culture of Accountability
Great boards are renowned for their strict standards for ethical and legal compliance. This includes having a robust code of conduct along with a whistleblowing policy as well as a conflict of interests policy. Boards must clearly communicate their policies and ensure that all members are aware of their responsibilities.
Avoid Micromanaging
The most efficient boards are those that have oversight but don’t get involved in the day-to-day administration of staff and operations. This lets the executive management focus on strategic issues. The board can better serve its stakeholders by avoiding micromanagement.