Governance – Beyond Resuscitation?
19/11/2019 12:01 PM
The idea of governance has been around for centuries.
And in the last century, the Cadbury Report gave it a make-over.
Yet today, governance lags far behind community expectations.
Disappointingly, the law’s most critical breakthrough appears to be holding a director liable if they don’t attend board meetings.
Inexplicably, it remains anchored in accepting a director’s own abilities to perform. Surely today it needs to reflect the high level of professionalism expected of board directors.
Not so it seems. Despite the many years of legal cases, the law’s expectations are far from rigorous.
This is in sharp contrast to our community expectations. Many examples show that many decisions or actions, or lack of actions, by directors can cause disaster. Many innocent people and their environments can be seriously hurt as a result.
So why does the law appear to be preoccupied with a director’s attendance and personal efforts alone at the board meeting?
It is no wonder that the community has little trust in boards and their governance practices.
James Shipton – ASIC Chairman – did not hold back when commenting on the level of oversight of some of Australia’s publicly listed company’s boards. He suggested that they are “immature”.
Dramatic change must now happen. The alternative is to archive boards, directors and governance.
Put everyone out of their misery. Let’s place boards and directors in a history museum of organisations.