Governance Frameworks

Why businesses need a governance framework

All business, whether big or small have governance frameworks. But, are the governance frameworks effective and efficient? Usually businesses don’t call their processes, systems and internal controls as governance frameworks, but this is exactly what they are. When it comes to corporate governance and governance frameworks, one size will never fit all and an organisation should consider designing policies, procedures and setting internal controls which are relevant and fit for them.

What does the OECD say about governance frameworks?

The importance of having an effective risk governance framework was highlighted in the OECD’s Risk Management and Corporate Governance report which you can find by clicking here.

Robust governance frameworks for better corporate governance and internal control

Why have governance frameworks?

Governance Frameworks are required where ever your business is based. In Dubai and Malaysia we see different types of businesses, entities and organisational structures. Some groups span different industries and even jurisdictions such as onshore, offshore or in free zones.

Diversity and culture as part of good governance

The beauty of diversity is that it makes your organisation unique and hard for your competitors to replicate. An organisation will spend time and money to build its brand, reputation, assets, and services to create competitive commercial advantage and increase market share.

Corporate Governance frameworks for good governance

Having the correct corporate governance tools will safeguard sustainable growth and healthy profits whilst protecting your business’s reputation and brand. We have seen numerous examples of businesses having the best corporate governance manuals and handbooks or even policies but still failing to following good governance practices. Why is this? The answer is simple, processes, systems, policies and procedures are useless unless followed by all employees and embedded in the corporate culture.

Embedding good corporate culture

We find that corporate training keeps employees engaged and helps them understand the purpose of your corporate governance framework. We provide accredited corporate training courses to company secretaries, management teams and directors.

An individual, a group or even a Board can choose to circumvent processes and systems to exploit weaknesses in internal controls and this can result in fraud or financial loss, worse still, such breaches could result in reputational risk and even impact on the market share of the organisation through a lack of trust. This is why corporate culture and embedded core values should be at the heart of corporate governance frameworks.

Doing things for the right reasons whether anyone is watching or monitoring. Robust corporate governance frameworks embed good governance into the corporate DNA.

In sophisticated groups and organisations you will see a holding company and numerous subsidiaries, each of which carry on operations and business to maximise profit, whilst being sustainable and maintaining market share and competitive advantage. In this region, it is normal to see Boards and Committees at the holding company level and on occasion, depending on the size of the subsidiary, you will also see a Board and Committee structure that mirrors the parent company.

If you are looking to formalise your organisation’s working practices, systems and internal controls or if you are looking to refresh your governance framework, look no further, our team of thought leaders and specialists can advise. Your organisation may require assistance to help embed or rollout a new governance framework and change to processes and systems.

Governance frameworks for good corporate governance

With experience in working with different types of entities, both in the region and internationally, we can advise and provide suggested options to ensure your organisation follows best practice governance, which is aligned with your Board’s risk appetite and tolerances.