You’ve got a business to run. You’re busy. Everything is running smoothly. As the Chair of the Board (or the CEO, Executive Director, or Board member), you’re feeling pretty confident that everything is under control. No need to complicate life with Board meetings, Committees, policies and endless reporting.
Or is there? By ignoring the importance of good governance, have you left yourself open to risks that could pose a threat to your business? Or to you and your directors personally? Do you know the extent of your personal liability?
Does your Board meet regularly? If not, you are probably not in compliance with your ByLaw. Are you in compliance with Bill 168? If not, you are placing your organization and your Directors at risk of lawsuits and fines. (Do you know what Bill 168 is?) Are your policies sufficiently rigorous to withstand a lawsuit? Are your Directors sufficiently well informed so as not to be held personally liable in the event of legal action?
But it’s not just about avoiding costly lawsuits. Good governance also contributes to the bottom line – it builds social, human and financial capital in your organization..
Good corporate governance is not just for big business. In fact, one could argue that it’s more important for smaller organizations, who can gain tremendous advantages from the effective use of their Boards and Directors.