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Governance of the board is the essential structure that helps set corporations up for success. It combines tried and true principles with best practices that enable boards to deal with complexity and elevate their organizations to the next level.
A clear set of rules establishes the direction of a business, oversees compliance and provides the necessary expertise to manage risk. It also sets the tone for corporate culture and accountability. With so many things to be done good governance requires a lot of effort and cooperation. We’ve compiled our top board governance tips to help you create ethical, efficient and profitable organizations.
Establish a Strategic Agenda for the Future
One of the most important things a well-governed board does is make a plan for the future. This provides directors with a direction and ensures their time is spent on the most valuable aspects for the organization. This could include creating a leadership development program to help the board’s next generation of leaders.
Establish an environment of accountability
Great boards are recognized by their strict standards in ethical and legal compliance. This includes a stringent code of conduct, a policy regarding whistleblowing and a code of conduct on conflicts of interest. Boards must clearly communicate their policies and make sure that all members know their responsibilities.
Avoid Micromanaging
The most effective boards will be ones that oversee operations but do not get involved in the day-to-day management of personnel and operations. This allows the executive management to concentrate on strategic issues. Additionally, avoiding micromanaging enables the board to better serve their constituents.