What is good governance?
What makes governance good? It’s a question we repeatedly ask ourselves as directors and it’s something John Page, managing director of BoardWorks, together with his co-founder, Graeme Nahkies tried to answer on this webinar.
The duo discussed the origins of governance, what it means, as well as the principles that represent good governance, such as, the role of the board.
Nahkies cited his experience during the global economic recession in the 1990s, which led to the bankruptcy of high-profile companies worldwide, during which many questioned the whereabouts and the role of boards and how they were meant to be protecting these organisations. Nahkies explained that the concept of governance as a discipline, in those days, really didn’t exist.
But for him, governance, simply put, is “about directing and controlling organisations.”
Throughout the webinar, Nahkies and Page, both of whom consult with hundreds of companies, elaborated and broke down the concept of directing and controlling organisations. They explained that the principles that fall under what is defined as good governance aren’t specific to an industry or business type.
Instead, “they're a group of people making decisions collectively and being accountable collectively for them and applying very similar disciplines in terms of decision-making, oversight, managing that interrelationship between board and management,” explained Nahkies.
While different sized companies may have more specific and stricter requirements versus a startup, the principles of good corporate governance remain the same. These include:
- Be a layer of ownership down, not a layer of management up
- Behave ethically, be transparent and accountable
- Be clear about how you intend to use others’ time and money
- Create the future, you can’t change the past
- Respect people’s time, make the job easy and satisfying
And, for John Page, the “board's job is creating the future, less about minding the shop.” To hear more about corporate governance, watch the full webinar here.