What is Governance? A simple but non-trivial overview

February 14, 2012 by admin

Board governance, or corporate governance, simply refers to the job of the Board of Directors. Boards are sandwiched between shareholders (or some other kind of ownership) on one side, and the CEO and staff on the other side. Because the ultimate authority for an organisation comes directly form its owners the role of Boards involves:

  1. Regular dialogue with the owners to establish what results are expected.
  2. Translation of the owner’s expectations into written criteria (policy) for success.
  3. Monitor to check that the criteria were actually met.

Boards of course may do a number of other things, but their core governance functions are simply as stated above – Ownership Linkage, Writing policy, and Monitoring outcomes.

Governance exists in order to translate the wishes of an organisation’s owners into organisational performance” Dr. John Carver

The following clip is narrated by Susan Mogensten of Brown Dog Consulting

What is Governance?  A simple but non-trivial overview

 

Our next Best Practice Report which is due for publication in March 2012 will cover the subject of Corporate Governance in detail.

If you are not already a BPIR member this is an excellent time to consider joining to enjoy the many BPIR membership benefits.

Neil Crawford
BPIR

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