Banking on Board Excellence
Banking on Board Excellence
‘‘Excellence is not a skill. It is an attitude”
Ralph Marston
This is so true in the context of Boards of Banks and Financial Institutions. the torch bearers of corporate governance. Boards need to rise to occasion in managing the challenges posed by the COVID-19 crisis, which continues to impact the economies worldwide. Board teams and individual directors are expected to excel in effectiveness, performance and corporate governance as evident in their actions surrounding prudent response, guiding the organisation’s recovery and subsequently organisation’s sustainability in the new normal.
As the current pandemic tapers down globally, with the governments around the world working to determine the best strategies to reach what could loosely be called a new normal, the boards will need to lead their companies through multiple challenges. Going forward, the Boards shall be focusing on the purpose, in being effective, making the most of digital and emerging technologies, being open to collaboration, being inclusive, having the right mix of members-that will go together to help them navigate today’s turbulent times thereby providing them competitive advantage and position them for a better future.
Strategy Development requires that organizations should not only be effective but there should also be Board Excellence in both letter and spirit. Board Engagement shall build the capacity of the Board Members to focus on wide ranging points collectively. Key areas to improve Board Engagement can include: Engagement between Board Meetings, Engagement for Strategy Formulation, Engagement for Talent Development, Engagement in the Field, Engagement on Tough Decisions.
Independent Governance Reviews
It is a good practice for the Boards to get an independent governance review done ideally on an annual basis, as a good step towards Board excellence. A governance review can be wide ranging, focus on effectiveness of the Board’s processes and its work viz. strategy, reviews, financial reporting and risk areas, meetings, documentation, director’s training, skill gaps, diversity, Board committees and their effectiveness. These reviews are normally formal and undertaken by a relevant professional or a professional firm. The board shall need to decide.
A review shall bring to the fore a few key queries in the given context of governance arrangements for example, have they kept pace with the versatility and rapid change within the organisation? Are the current structures still fit for purpose? Do they allow appropriate decision making that the dynamic environment requires?
An independent governance review should assist the organisation in providing the confidence both internally and externally that governance arrangements are ‘fit for purpose’ and help deliver the organisation’s intended objectives. It shall also be useful to identify the gaps and develop action plans and timelines to implement agreed plan of action towards tangible improvement.
Towards the end this brief, leaves me with a few queries i.e. When was your last review? Is your governance fit for purpose?
