Current levels of trust in businesses and the government are low.
We don’t need to go far back in history to see how bad governance can ruin lives and tarnish industries. Remember Enron and Lehman Brothers? These are just 2 recent examples of poor governance and the increasing expectation from society for the heads of businesses to be accountable for their organisations. While laws and regulations are necessary foundations, truly good governance that takes organizations to new levels of performance over the long term goes far beyond the law to instil trust and effectiveness.
When I work with my clients to define their business processes, it is very rare for the client to offer a top-level process that defines the ‘rules’ of the company; I have to tease it out. Every company has a ‘Governance’ process to some degree, and it’s effectiveness can’t be established until the process has been defined.
In this context, ISO’s committee of experts that specialises in governance has just been given the green light to develop an ISO international guidance standard that will help organisations to establish good governance practices, going beyond the avoidance of risk and contributing to their long-term value overall. Personally, I think this is a real breakthrough that will help a huge number of companies.
The working group that is developing the standard, said:
“There are many governance standards out there, yet there are currently none that are applicable to organisations that span all jurisdictions, industries, sectors and types.
“With increased connectedness and interdependence, the importance of this is rising continuously. This standard will therefore fill this gap in standardisation, allowing it to be accessible and useful for any organisation, whether it crosses different sectors and geographies or is simply a small business that feels it can benefit from better governance.”
Victoria Hurth, Co-Convenor of the working group, said: “The benefits of good governance are well evidenced. As well as reducing the risk of bad surprises that can destroy an organisation, a well-governed organisation is more trusted and attracts talent, which in turn drives performance and investment. The proposed new standard has the potential to increase the number of socially, environmentally and economically sustainable organisations, providing multiple benefits for investors and society as a whole.”
The new guidance standard for the governance of organisations is due to be published by 2020 and I for one am very encouraged by this.
Back to Blog