The Organization of Effective Corporate Governance
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The effective management of corporate governance is crucial to the success and growth of your company. It’s a way to ensure that decisions are being made in the best interests of the shareholders and the company and also to protect against mismanagement and corruption. It also enables the company to achieve its financial and social objectives while remaining in line with the legal requirements and environmental, social, and governance (ESG) best practices.
The primary stakeholder influencing corporate governance is the board of directors (BOD). As such, BOD members are responsible for dictating the policies of the company and making decisions about plans and objectives, whereas management is responsible to implement those goals. Although the traditional duties of the BOD are financial, the current trends are pushing the BOD to assume greater responsibility in areas like the promotion of equal and fair treatment for all stakeholders including shareholders, employees vendors, shareholders, and local communities.
Policy development
Documenting and implementing internal policies and processes is an essential element of a successful corporate governance. These policies should reflect the culture of the organisation, be in line with legislation/regulations and help achieve its desired goals. The availability of policies can facilitate decision-making and aid the organisation to manage its risk appetite.
A sound corporate governance includes developing strategies to address the challenges and opportunities that the organization may face. This includes a process referred to as succession planning, which is essentially managing talent with the goal of future-proofing the organisation by establishing a strong leadership pipeline.
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