Although there is no globally recognized definition of good governance, its key attributes are still responsibility (shepherding an organization away from risks, around challenges, and towards success), accountability (readiness to back up your decisions no matter what they are), awareness (knowing the landscape of risk around your company), impartiality (ensuring no personal interests of your colleagues cloud decision-making), and transparency (documenting and reporting all activities clearly and thoroughly).
The list may look heavy, but all its points must become persistent commitments of your board if you want to stay on the right path to success. To help you make things simpler, we invite you to explore a board portal.
We have prepared several real-life examples of poor leadership to highlight its potential consequences.
Failures can happen even when basic things are not done right. In 2015, Sports Direct faced problems when reports surfaced about employees working in unsafe warehouse conditions, pay violations, and mismanagement. Their CEO, Mike Ashley, was required to appear before parliament to testify. As a result, the board got into legal trouble, resulting in a financial loss for the company.
The prioritization of profits over employee well-being shows a lack of accountability and responsibility from the board and senior management.
Extra insights: What is a board governance?
This American energy company committed one of the biggest corporate scandals in history. With the help of their accounting firm, Enron engaged in fraudulent actions, hid debt, and cooked the books. Investigators discovered that all this resulted in bankruptcy and the loss of $74 billion in shareholder value.
The scandal exposed weaknesses in corporate governance practices, including board members’ lack of independence and expertise.
You can’t vouch for the honesty and transparency of every director, executive, or secretary. However, you can integrate board software, which mitigates all related risks and creates a more productive and transparent board environment.
It is a protected online platform designed for corporate governance purposes. With it, users can safely and easily access data, collaborate, and make decisions in a controlled environment.
Robust security, multi-functionality, and ease of use have made the product popular among many industries. Some of them include financial services, healthcare, education, government, and technology. They use the platform for board meetings, governance compliance, document management, board evaluation, and many other purposes.
Note: Since our post is about governance success, we’ll stay on course and demonstrate how the solution meets the critical attributes listed in the introduction. However, we recommend researching top providers to explore all their capabilities (video conferencing tools, tools for drafting agendas and meeting minutes, integrations, etc.). This way, you can get a full view of the benefits of board portal software.
Here’s how the solution can support you in following the basic principles of effective governance:
|Success metrics tracking – Monitor key performance and success indicators to get insights into the organization’s progress toward its strategic objectivesHeat maps – Visualize risks to prioritize and categorize them based on severity and likelihoodRisk documentation – Store and manage all related data, including risk assessments, policies, procedures, and compliance documents, in a protected space
|Decision tracking – Record and track decisions made during board meetings, including the rationale behind each one and any associated actionsAudit trail – Maintain a detailed log of board activities, document revisions, and user interactions within the board management software
|External environment monitoring – Integrate with external data sources, news feeds, and regulatory updates to keep all board members informed about industry trends, market conditions, and regulatory changes that may pose risksCommunication spaces – Discuss and share insights on emerging risks, mitigation strategies, and best management practices in feature-rich communication hubs
|Conflict of interest management – Identify, disclose, and manage conflicts among board members and stakeholders with the help of analytics tools to ensure fair decision-makingAnonymous voting – Express your opinions without fear of bias or influence from personal relationships
|Granular access controls – Manage permissions and restrict access to sensitive information based on user roles and responsibilitiesCompliance reporting – Generate documentation and evidence of compliance efforts for regulatory audits or reviews
Board governance is challenging and often requires innovative solutions beyond traditional ones. With a board management platform, you can increase efficiency by better controlling every director and document involved. This way, you’ll never have to testify in front of parliament or look for a way to make your documents disappear.