Poor Governance — the warning signs

In its simplest form, there are 4 stages on the Path To Good Governance:

1.       Understanding the need for Good Governance

2.       Building the business plans, clarifying the organisations purpose, and defining the strategy, key risks and governance framework.

3.       Embedding the business plans and governance framework into the organisation

4.       Continuous Reflection & Improvement – Is everything working? Will it continue to work? Am I as a director evolving & contributing…?

Often the hardest part of any journey, is taking the first step. When it comes to the Path to Good Governance, this is understanding the need which often starts with recognising what is wrong with the status quo.

From experience there are 9 warning signs of Poor Governance, highlighting the need to change:

  1. Detailed board papers — lots of data, little information.
  2. Unclear measurement — poor link between risk and return.
  3. A CEO who looks for guidance, finds themselves setting the agenda.
  4. Low value add from the board.
  5. Poorly prepared board/ board members.
  6. Discussion focused on yesterday and tomorrow, not next month and next year.
  7. Poor link between risk and strategy.
  8. Most focus on identified risks, not strategic risks and environmental change.
  9. Not engaging, when needed.