I've been pondering this question for quite a few years now, since reading a seemingly endless stream of articles about the global financial crisis of 2007–2009 published in the popular press and academic literature. Curiously, many authors identified the board as a source of failure (of corporate governance), yet few if any have offered positive contributions to put corporate governance back on the tracks. This apparent void was one of the motivations of my doctoral research quest.
However, from time to time, articles do stand out, because the authors speak out. Their comments may not be popular, but take a stand they do. Recently, the ICSA recognised one such author, Ruth Keating, who openly asked the question in a recent essay competition. Two sentences towards the end of her well structured and very readable essay say it all:
“Corporate governance can do better, and with significant investment, capital and jobs on the line, it must. Good governance requires a new approach, because governance has become a formality to be satisfied rather than something which can be hugely valuable."
My hope is that, by openly asking the question (as Ms Keating has) others might join the debate. One outcome could be a new understanding of corporate governance and a genuine commitment by the board to add value. Who knows where this might lead, perhaps even to a new normal, whereby boards expect to exert influence from and beyond the boardroom. If that is achieved, a new dawn might not be too far away.
Thoughts on corporate governance, strategy and effective board practice; our place in the world; and, other things that catch my attention.