On emerging issues
Diversity and response to climate change are dynamic and evolving issues for corporate leadership. Diversity whether in relation to the role of women in senior positions or minority groups in the workforce require strong governance statements and positioning.Governance has several cornerstone principles:
- The foundation of any effective structure of corporate governance is disclosure. Openness is the basis of public confidence in the corporate system. Companies that fail on the transparency and openness quality will not inspire trust
- CFOs could look out for corporate-governance weaknesses, say experts. Such weaknesses are red flags for large institutional investors, which have been more active in public statements
- There is a linkage between governance failures and exposure to class action that has been illustrated by the James Hardie case. Governance is a bottom-line issue
- Company owners and boards need to view their board of advisors and board of directors as representing the highest principles of corporate governance. Extraordinary skills are one thing but the appropriate public face matters too. While there is little a CFO can do directly to improve the quality of a board, a reporting the results of regular governance-risk benchmarking to the board is an effective communications strategy. Such reporting could also include, but not be limited to, benchmarking the board itself compared with competitors or industry leaders.
Join the CIO Australia group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.