Are you keen on keeping up to date on the latest research in corporate governance? Don’t have time for pages of needlessly pretentious verbiage? Then this is the series for you. In Research Recap, Directorpoint gives boards of directors the need-to-knows on corporate governance hot off the presses of the leading industry journals. Just tell people you read the full thing; we’re not snitchin’. Continue reading
If you’re perusing the latest issue of The Wall Street Journal, take a moment to flip to the back of section A. You won’t be able to miss the full-page spread that was secured by 13 of the country’s most influential business leaders.
The ad, which is signed by people like Warren Buffet of Berkshire Hathaway and Mary Barra from General Motors, has one major purpose: to offer up commonsense governance principles “in the hope that they will promote further conversation on corporate governance.”
The article, which is also presented in full at www.governanceprinciples.org, begins by outlining how the future of the economy relies heavily on companies “being managed effectively for long-term prosperity.” It points out that millions of Americans’ retirement savings, college savings, plans to buy a home, and more are directly affected by decisions made by board members at major corporations.
The authors continue by insisting that although they don’t agree on every single aspect of corporate governance, they can offer up six major principles on which they can agree. The principles are summarized in the main article but can be viewed in depth here.
Leadership is the capacity to translate vision into reality.
He may not have known it at the time, but when Warren Bennis (American scholar and pioneer of Leadership Studies) penned those words, he was aptly explaining what strategic guidance means for the boardroom today.
Directors must be prepared not only to envision the future of the company, but also to find the best way to guide it into the fulfillment of that vision.
To understand what strategic guidance means exactly, we must take a look at the two words individually.
Crafting company strategy is an essential function of a board of directors. Simply stated, board members must bring their assortment of individual knowledge and experience to the table in order to seek out the best path forward for the business.
Strategic thinking takes many elements into consideration: goal setting, prioritization, realistic financial planning, and more. The expectation is that board members should be looking at the horizon rather than at the ground beneath their feet.