How should an organization select its leaders? Set direction? Mitigate risks? Oversee management? Handle crises? Governance addresses these questions. It's concerned with the responsible exercise of power, how it is acquired, and how those who exercise it are held to account.
There is no “best" model of governance. A sound system needs to be suited to the mission, people, traditions and culture of the organization. It should be sufficiently nimble to address short term issues, while providing the organization with longer term direction and motivating staff to perform well.
It should oversee how resources are allocated and how money is spent. But it should not stifle initiative with an overemphasis on accountability.
It should ensure that the “right” people – whoever they may be – have a say in important decisions. It should be fair, transparent and ethical. It should provide for positive, mutually supportive relationships between governors, such as board members, and the staff who work for them. Around the board table, there should be a culture of inquiry, a climate of mutual respect and a focus on the issues that matter most to the organization.
In short, good governance is about balance. A well-designed system must take many considerations into account. Assessing the performance of an existing system, or determining how it might need to be altered in light of evolving circumstances, calls for careful judgment.
Governance change can be controversial and difficult. Existing arrangements often embody relationships, traditions or patterns of influence that people are reluctant to alter. Our experience is that getting change accepted is about 20 per cent a matter of substance and 80 per cent a question of strategy. Without a sound strategy, reform runs into the sand.
Our firm is very experienced in helping organizations deal with the challenges of governance design or reform. We do so in a careful, sensitive and constructive manner. We’ve worked with dozens of boards, CEOs and Executive Directors. Please contact us if you think we could be of service.