What are governance professionals thinking right now?
I know from talking to our members, that right now, they are thinking about the implications of current events for their organisations, the lessons they can learn, and how they can support their boards and their organisations. I have also been reflecting on how we can support our members during the current challenging environment.
The governance professional’s role
Boards cannot delegate their duties and responsibilities to governance professionals — they retain ultimate responsibility. This does not mean boards carry out this important task without support. The governance professional’s role is to ensure boards have proper governance frameworks and processes in place — to be trusted advisers to boards on governance. They can scan the horizon for emerging issues and point out critical red flags when necessary. They can point out risks — financial and non-financial — when they are not being considered by the board, and advise their boards if current thinking is changing. This will require an open, honest relationship between the governance professional and the chair. So think about the responsibility you can take for improving your relationship with your chair.
You can take other practical steps. I hear some boards are carrying out self-assessments against the APRA Prudential Inquiry into the Commonwealth Bank of Australia. The APRA Report has much broader application than the banking sector.
Here are some issues you might work through with your chair:
- Critique board agendas — how is the board spending its time?
- How does the board consider non-financial risks?
- Does it discuss culture?
- Do routine reports occupy the bulk of meeting time?
- Does the board take time to do ‘deep dives’ into business areas with a focus on risk?
- Does the board engage with, and challenge executives?
- Are discussions robust and effective?
How does Governance Institute support you?
Firstly, we represent your point of view and inject your voice into the debate. We also help you learn about and think through the issues by providing practical information and tools. If you need to learn more about corporate culture, I recommend the UK Financial Conduct Authority’s March 2018 Discussion Paper Transforming culture in financial services — a collection of essays on various aspects of culture relevant to all sectors.
Also, we have produced — jointly with The Ethics Centre, Institute of Internal Auditors Australia and Chartered Accountants Australia New Zealand — Managing culture – A good practice guide. This guide offers a road map for implementing strategies to assess and embed corporate culture. We have many other tools:
- Risk Management for directors: A handbook
- Good Governance Guides
- technical booklets
- email News Updates
- Governance Directions
Maximise our network
For me one of the greatest supports we offer is a network of like-minded professionals. By working with other members on a committee, council, discussion group or attending an event or by simply picking up the telephone, you will meet other professionals facing similar challenges and learn from them.
I encourage you to engage with your fellow members at upcoming events including complimentary member discussion groups and the LinkedIn member-only group.
If you are not already member, I encourage you to join our community of governance and risk management professionals.