Board governance is the crucial structure that allows corporations to be set for success. It combines tried-and-true principles with best practices to help boards navigate the complexities and propel the organization to the next level.
A clear set of rules determines the direction of a company, oversees compliance and provides the necessary expertise to manage risk. It also sets the tone for corporate culture and accountability. Governance isn’t easy especially when there are a lot of things on the line. We’ve gathered the top governance tips for boards to build ethical, legally compliant and effective organizations.
Create a strategic plan for the future
A well-managed board sets an ambitious program for the coming years. This gives directors a focus and ensures that their time is spent in a way that’s most profitable for the organization. This could include establishing the leadership program needed to prepare the next generation of board directors.
Create a Culture of Accountability
Great boards are known for their strict standards for ethical and legal compliance. This includes a strong code of conduct, a policy on whistleblowing as well as a policy on conflicts of interest. It’s important for boards to clearly communicate these policies and make sure that everyone is aware of their obligations.
Avoid Micromanaging
The most effective boards are those that have oversight but don’t engage in the day-to-day management of staff and operations. This allows the executive management to focus on strategic issues. The board meetings performance board can better serve its members by eliminating micromanagement.