Corporate Governance and Accountability Tips To Deliver Corporate Social Responsibility And Improved Business Performance
Tips for good corporate governance for sustainable business development with less uncertainty. Find new ways to improve corporate governance in UK. Take the best practice steps in corporate governance to boost business sustainability.
Now the global economy is recovering politicians and organisation leaders need to decide whether they want to build sustainable wealth creation or pump-up another bubble which will pop with anarchic consequences. Society has reached a turning point. We have to look again at the way we do things. That is what corporate governance is the way a business does things and treats all stakeholders in the business not just executives maximising their pay and benefits.
Good effective corporate governance principles and practices will spread the benefits of economic prosperity more proportionately. This may well mean the peaks may not be as high for the enterprise but the likelihood of total wealth destruction will also be mitigated. Risk taking to achieve more success can still exist within good corporate governance but in a more controlled manner in alignment with the risk tolerance of the business or enterprise.
Change The KPIs For Executives To Align With Good Corporate Governance
Businesses need to identify and use key performance indicators KPIs that are not solely focused on increasing profit. Organisational maturity and societal cohesiveness must figure somewhere within the KPIs to build longer business sustainability for the benefit of all business stakeholders.
- What is your business doing to protect and grow in a few years time not just a few months time? If your business has no idea how to create its long-term future, then it may have not future.
- How are you attracting and retaining staff in an environment of growing skills gaps?Paying more may well hit short-term profitability but it may ensure profitability for longer.
- How does your talking align with your walking? Is so easy to talk a good game about corporate governance and risk management, but are you really doing the right things and the right time?
- Do you know how happy your customers are with your products or services? It maybe too late to correct minor errors if you don’t find out, and then minor errors become no repeat orders and no new orders as your bad service message has hit the marketplace.
- What are you doing to connect with all stakeholders in the business including the community within which you operate? The value of goodwill can equate to pounds and pence as well as doing the right thing.
The above are just some examples of where new KPIs could help you monitor your corporate governance and risk management maturity not just for the sake of measuring but to aid continuous business performance improvement, achieve objectives more easily and build a better business for long term sustainability.
Improving your corporate governance and risk management regardless of the size of the business will define how you want your business to act perform and be seen to perform. Ensure everyone is clear what your business should and should not be doing. Engage your whole workforce and create a business culture that is trusted by those in and those outside the organisation.
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3rd October 2018 Former International Monetary Fund IMF Chief Rodrigo Rato Sentenced
Rato was economy minister in Spain and a prominent figure in the ruling People’s Party PP before moving to the IMF. He chaired Bankia for two years until just before its state bailout in 2012.
In 2017 the court considered Rato responsible for overseeing the misuse of credit cards and said he could have reversed the practice that involved dozens of other executives and board members of Bankia.
Rato had appealed the ruling and denied any wrongdoing arguing the expenses he accrued on the Bankia credit cards were legal.
Supreme Court considered the sentence to be proportionate due to Ratos preeminent position at Bankia from whose assets he had “profited unfairly and allowed others to profit”.
The credit cards were used to buy jewels holidays and expensive clothes according to documents filed with Spains High Court but also to fund more mundane purchases such as trips to the cinema.
Before chairing the Washington based IMF between 2004 and 2007 Rato was deputy prime minister in Spains conservative government in 1996
16th July 2018 New UK Corporate Governance Code To Win Back Public Trust In Large Corporate Businesses
A new voluntary corporate governance code written to improve trust in business has been published by the accountancy watchdog the Financial Reporting Council FRC.
Changes proposed to existing corporate governance include banning senior executives from selling performance and remuneration incentive shares awarded to executives for five years and encouraging firms to improve how they engage with staff.
Stock market listed UK firms opting out of non mandatory corporate governance code would need to explain to investors why they had opted out.
Firms are expected to either appoint a worker to their boards nominate a non executive director responsible for representing staff or create a separate employee advisory council
If a company experiences a shareholder vote of 20 percent or more against a proposed change they will have to explain how they will consult with shareholders about the protests against company changes wanted by senior executives.
The new code will apply from the beginning of next year.
The FRC is also working on a separate corporate governance code which will apply to large privately held firms.
17th June 2018 Holding executives personally accountable for suicide of employees
Executives should want to embrace good corporate governance best practices. If they do not put in place good corporate governance then it may well fall back on them personally.
Orange exboss faces trail over suicides
A former head of France Telecom which has been renamed Orange and 6 other directors face trial over a number of suicides at the company allegedly caused by a culture of harassment at the company. It is alleged that the executives HR policy was to arrange to make staff life a misery to force them to want to leave.
The business culture was allegedly so bad 30 people took their own lives.
If the executives are found guilty they could go to prison and face fines of up to 30000 euros.
27th February 2018 UK Business Leaders Want Tighter Controls On Executive Pay To Improve Corporate Governance Of UK’s Biggest Companies
Institute Of Directors IoD representing many executives in UK, wants the Financial Reporting Council FRC to include greater transparency and accountability over executive pay in the FRCs corporate governance code of business standards for large listed companies in UK.
In particular the IoD want the FRC to give pay committees more responsibility over executive remuneration. In addition the FRCs reduced emphasis on director training in its draft revised code will do little to improve board-level behaviour or decision making.
Currently executives have inappropriate KPIs for long term business sustainability and are still rewarded for failure post failure.
The FRC needs to change its corporate governance code to reflect practices that support long-term sustainability not chasing a fast buck.
25th January 2018 How Do You Embed Good Corporate Governance To Boost Business Performance
If good corporate governance principles and practices are to be sustainable, corporate governance has to play its part in the sustainable business performance of the enterprise.
- Pick up tips for effective corporate governance
- Run your business properly now and it will provide you with long-term results to satisfy your needs
- Develop a more practical approach to good corporate governance
Good corporate governance can support the sustainable growth of your business. For some businesses it is a compliance issue, but for others its about improving the way you do things in business.
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