Developing good governance
The biggest casualties of the global financial crisis have been trust and confidence. Both private companies and public institutions now attract much greater scrutiny. They’re expected to explain their business practices, disclose key relationships, justify their remuneration models, discuss their succession plans and make a wider contribution to society.
It’s not just investors they have to satisfy. They also have to answer to regulators and the general public. And, as many organisations move into new markets, they’re engaging with a more diverse mix of stakeholders, each wanting different kinds of information.
The digital technologies are simultaneously transforming the way we communicate. People can see – and say – more about the organisations that serve them than ever before. New risks, including new forms of risk, are also emerging, and the regulatory burden is increasing. So the pressure to be transparent, accountable and socially responsible is greater than at any time in history.
What does this mean for your business?
Any organisation that wants to survive, let alone succeed, will have to embrace new regulations and technologies, manage new risks and prepare for the future with robust succession planning. That means many private companies and public institutions will need new governance models.
Top management will also have to assume more supervisory responsibilities, and simple compliance with the rules won’t be enough. The management team will have to communicate its governance policies, processes and organisational culture to all its stakeholders. It will also have to go beyond traditional reporting and address issues such as sustainability and tax contributions.
Transparent disclosure is the key to building trust and changing the way stakeholders and the external markets view your business. But transparency alone isn’t sufficient. Demonstrating good governance involves creating a true dialogue with stakeholders, not just communicating openly.
View our latest Governance research and insights
Understanding the needs and opinions of investment professionals is crucial if management teams are to prepare truly useful financial reports and accounts. PwC has conducted a series of surveys of investment professionals aimed at maximising the effectiveness of corporate reporting.
Jul 21, 2014
Risks are becoming ever more interconnected. How can leaders make their organisation truly resilient and grab opportunities too?
Jul 21, 2014
Research suggests a growing skills gap could threaten the economy but that employers can take specific steps to mitigate the impact
Jul 17, 2014
US and UK shareholders are targeting the same theme, with similar results.
Jul 11, 2014
There is plenty of evidence that investors value the auditor’s opinion on the financial statements. They don’t want to lose it. But in the wake of the financial crises, investors and other stakeholders began to call for auditor’s reports to be more informative. Auditors have unique and relevant insight based on their audits and investors and other stakeholders are asking auditors to share some of that insight.
Jun 27, 2014
Russian companies face unique pressures in the future – and have access to unique opportunities. Are directors ready?
Jun 24, 2014
Cyber security experts are telling companies to prepare their business for the impacts of upcoming changes to EU data protection laws.
May 27, 2014
A new corporate governance Directive aims to provide greater transparency for shareholders
May 19, 2014
The FRC is revising the UK Corporate Governance Code, including risk, remuneration and going concern
May 19, 2014
CEOs are increasingly seeking “good growth,” aligned with business ethics and sustainability. Dennis Nally explores the importance of building trust for business.
May 14, 2014