Sailing the good ship, corporate governance

Has managing a business ever felt more like navigating a boat in stormy seas?

With no agreement on Brexit, a protectionist US president and an absent Stormont government, business leaders in Northern Ireland could be forgiven for feeling like they’re in a dinghy in a force nine gale. Just as a ship in dangerous weather needs all hands working together, a clear, steady focus on the horizon and everyone operating at peak performance, businesses in Northern Ireland must get their corporate governance in shape to weather this storm.

Corporate governance is simply the system by which organisations are directed and controlled. A longer definition, according to the OECD, is that: “Corporate governance provides the structure through which the objectives of the company are set, and the means of attaining those objectives and monitoring performance are determined.”

In turbulent times organisations which have a well-developed set of goals, a plan to achieve those goals and who regularly monitor their performance and their risks are clearly a step ahead. The destination and the environment may change and change often so nimble organisations that respond swiftly are much more likely to succeed.

A well-developed governance structure requires businesses to understand the relationship between strategy and risk so that leaders can make the right decisions and steer their organisation through the most turbulent of waters.

Having the right tools in place is also essential. These should be tools that lighten the administrative burden and provide the time and information needed to make the right decisions without complicating matters or getting in the way. Leaders armed with the right information and the right tools to manage that information will always have the best chance of making the right decisions, whatever the external environment throws at them.