As a corporate secretary or other governance professional, your approach to board undertakings is likely grounded in best practices. You also commit to formal and informal ongoing professional development to ensure you're well positioned to support your board and organization; that's doubtless why you're reading this article right now.
If you were to attend an event with counterparts from different organizations, and someone asked a group of you to identify the top five corporate governance best practices, how would that conversation unfold? Do you think that all of you would land on the same five best practices? Might some people need a bit of time to reflect, focused as they may be on delivering on best practices rather than articulating them? Or would some governance professionals refrain from contributing to that particular conversation on the basis that they exercise their governance expertise within a public institution, a not-for-profit (NFP) or a private company?
The fact is, corporate governance best practices apply across (forgive me) the board. They aren't restricted to those entities that are legally structured as corporations, nor should an organization's size be a consideration. Whether you identify the nature of your role as corporate governance or board governance, the principles are consistent.
Such principles encompass standards and a framework within which an organization's leaders do more than execute effectively on well-developed strategic plans. These standards establish expectations that those at the helm shall also be not only effective, but responsible, in meeting stakeholders' needs. Different organizations will have some unique internal and external stakeholder groups, which may include shareholders, employees, clients, students, patients, the government, the public or other bodies.
An organization's readiness to apply corporate governance best practices can impact more than strategic planning and short-term performance. Adherence to best practices in corporate governance is in itself a form of risk management that can also pre-empt unwanted legal issues.
Best Practices in Corporate Governance
Best practices reflect our times - and the evolution of governance itself. With this perspective in mind, what would you identify as the top five best practices in corporate governance? Terms and activities such as disclosure, transparency, independence, integrity, diversity, strategy, evaluation, refreshment, and effective risk management/enterprise risk management (ERM) may spring to mind. Each of these characteristics or processes neatly finds its place within an umbrella, or overarching set, of five best practices:- Development and Maintenance of a Competent and Diverse Board
- Commitment to Integrous and Ethical Behavior
- Defined Roles and Responsibilities
- Alignment of Strategies and Goals
- Accountability
Enterprise Governance Management (EGM) Solutions
With your board's attention to best practices, you may also have an eye on resources that support effective governance operations. Enterprise Governance Management (EGM) is the application of technical tools and resources to meet your board's needs. Diligent Boards'Ѣ positions you to leverage technology, and it goes far beyond providing secure access to meeting materials. Whether it's efficiency-driven Director & Officer (D&O) questionnaires, board evaluations, automated process chains that support compliance or access to policies, risk and other reports, or communicating and sharing documents securely in real time with Diligent Messenger, these EGM tools support governance best practices.Your Board's Top Five Governance Best Practices
Thinking back to onboarding and education practices in place for your board, how would a discussion of best practices unfold in your boardroom? If you were to ask individuals around the table to name the top five corporate governance best practices, would you find directors and management approaching governance through a common lens?Media Highlights
Environmental, social and governance (ESG) issues have become more complex and multifaceted than ever before. At the same time, ESG continues to ascend on board and leadership agendas.
In this buyer’s guide, we explore what a market-leading ESG solution should look like and highlight the key areas organisations should be prioritising as they embark on their search.