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The expanding role of the governance professional

By Megan Motto FGIA, Chief Executive Officer, Governance Institute of Australia

As I have travelled the length and breadth of the country over the past few weeks for our Governance and Risk Management Forums, I’ve been fortunate to meet with so many amazing attendees and speakers — professionals working in the governance and risk space across all manner of industries.

So, what exactly does it mean to be a ‘risk management professional’ or a ‘governance professional’? Are they in fact, professions?

While the Governance Institute’s origins are as a membership and education body for company secretaries, our membership and the role of the company secretary have changed significantly over the last twenty years.

Historically, the role of the company secretary was that of minute taker, responsible for accurately recording decisions at board meetings, maintaining corporate records and attending to statutory filings.

However, the role of the governance professional, particularly for those in senior positions has evolved significantly over the last twenty years so that they now have a far more proactive role in monitoring and bringing important trends and information about the changing governance landscape to their boards’ attention.

This trend was particularly pronounced during the COVID-19 crisis where our members reported being very stretched, and many taking on expanded roles juggling the legal, company secretariat and compliance functions during the crisis.

Our members tell us this expansion of their roles has continued as the COVID-19 crisis recedes. Particularly in larger companies there are often now governance ‘teams’ which will include a range of governance professionals with varying levels of experience working at varying levels of seniority.

As company officers, company secretaries have duties under the Corporations Act 2001 and common law. Given the complexities of the modern corporate world, regulators are increasingly and more frequently taking action against individual company officers for breach of duties.

As the role of the company secretary has evolved, so too have the risks attached to the role.

The unique set of skills, responsibilities and training now required by organisations to fulfil these duties has seen the role of Company Secretary listed among the top 20 priority skills on the National Skills Commission 2022 Priority List.

In the last decade, the Governance Institute has also seen an increase in our membership of individuals who identify as ‘risk management professionals’ which they see as a separate and distinct discipline.

Recognising and managing risk is a critical part of a board and management’s governance responsibilities.

While the board is ultimately responsible for oversight of a company’s risk management framework, day to day implementation of the framework is management’s responsibility. In a smaller company responsibility for risk management may be combined with other responsibilities, but in larger companies there is frequently a team of risk ‘specialists’ reporting to a Chief Risk Officer.

These skills too are in hot demand. There are currently around 2500 jobs being advertised nationally for the role of ‘risk manager’. This is even though there is no actual job classification with this title.

In our most recent submission to the Australian Bureau of Statistics on the current standard classifications of occupations, we have put forward recommendations that ‘governance professional’ and ‘risk management professional’ be their own unique categories to better capture the true nature of the roles.

To ensure that we as the Governance Institute prepare our members and students for the changing nature of these roles, we’re undertaking important research through our membership of the global Chartered Governance Institute to determine what it means to be a governance professional in 2023.

Our education team is also developing a governance capability framework, with recognised stackable micro-credentials and a diagnostic tool that allows students to audit capability and training options, making sure they are properly qualified to take on some of these vitally important roles for companies and organisations.

For more details, head to the submissions page on our website.

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