The 10 Steps to Good Governance
Good governance is critical to any organisation, regardless of its size, whether you are a large corporate, SME, not for profit, charitable organisation etc. A board of governance is charged with translating the stakeholders expectations and requirements into performance and ensuring that accountability for the capital and other resources are provided.
There are some very simple guidelines to ensure that governance is enacted in best practice. Best practice governance principles are based on good:
Direction: vision and strategic goals (what the organisation is seeking to be and achieve)
Leadership: strategic thinking, and continuous pursuit of best practice
Transparency: in strategy, plans, monitoring and reporting on performance
Performance: ensuring the organisation is well managed, well prepared and on track to achieve its vision and performance outcomes.
These ten principles should form a code of best practice:
1. Board members observe and foster high ethical standards
2. Board members act within the expectations of the Value statements of an organisation
3. Board members recognise and respect individual member’s skills, knowledge, experience and perspectives in order for the board to work effectively
4. The board can use sub committees to consider proposals, strategies, and make recommendations to the board to enhance its effectiveness and maintain its responsibility and accountability to stakeholders
5. The board demands integrity both in financial reporting and in the timelines and balance of disclosures of the entities affairs
6. The function of the board is transparent, fair and reasonable
7. The board regularly verifies that management has appropriate processes in place to identify and manage potential and actual risks
8. The board undertakes independent external audits
9. The board ensures that management fosters constructive relationships with its staff and external agencies
10. The board respects the interests of stakeholders within the context of the organisations Vision and Mission statements.