Corporate Governance Tips For the 21st Century

As the world continues to evolve, a company’s corporate governance policies must evolve. The days of companies refusing to address shareholder concerns are long gone. With shareholder activism on the rise companies must take the initiative to recognize and address shareholder discontent before it becomes an issue during proxy season.

This means that a solid risk management process, internal control framework, and a disaster recovery plans are essential to the success of a business. It is also important for businesses to recognize and accept that addressing risk is not an event that happens once, but a continuous process.

Companies that place a high priority on establishing good governance will be more successful in the long term. Corporate governance isn’t only about checking boxes or achieving the legal minimum. It’s about laying a foundation for sustainable growth of business.

With the variety of risks and challenges that a business can face increasing, it’s vital that board members understand how to navigate those pitfalls. This starts with a thorough knowledge of best practices policies which are constantly updated to ensure compliance and reflect the values and culture of the organization.

It is equally important that boards spend the time necessary to understand and implement technology that demonstrates best practices, such as generative AI. This requires time and money but is the only way for directors’ boards to gauge how well their organization is managing its risk.