Boost board performance with corporate governance best practices

Corporate governance best practices offer guidelines for board members to be most effective in bringing strategic value to their organizations. Board chairpersons and members help ensure the board plays a key role in their company’s success when they develop strong understanding of, and successfully implement, corporate governance best practices.

While there is no definitive set of corporate governance best practices, here is a quick overview in four broad categories. This may help you consider your best direction for corporate governance training, which you can use to expand on these insights and effectively implement the right best practices for your company.

1. Coherent business direction
To provide a successful leadership structure, boards and company management need to set clear, common goals and move in the same direction. Corporate governance best practices formally establish goals, ensure support by top levels of management and board, and clearly communicate to stakeholders. Corporate governance best practices designed to ensure coherent business direction will eliminate inefficiencies and ensure the confidence of stakeholders including shareholders, employees and customers.

2. Strategy
Coherent goals are useless if no thought is put into getting there. The board can help a company reach its goals by ensuring effective strategy through corporate governance best practices. Questions to ask include:

  • Are corporate governance strategies aligned with stated goals?
  • Are appropriate resources available to implement corporate best practices?
  • Do strategies account correctly for the internal and external environment, including obstacles and opportunities?
  • How is risk managed?
  • Is the corporate structure suitable to best practice strategies?

Corporate best practices should be implemented through formal processes and then continually evaluated against pre-determined indicators. Finally, transparent reporting is necessary for stakeholder trust and legal requirements.

3. Corporate responsibility
The global business world of today isn’t just business – governments, NGOs and other non-business players affect your operations too. Responsible business – growing your business while accounting for environmental, political and social impact – is good business. Corporate governance best practices that address corporate responsibility and sustainable business development will help secure your business’s long-term future – and make your company a part of solutions to pressing human challenges.

4. Accountability
The board is critical to ensuring the accountability of a business. Corporate governance best practices can help boards develop and ensure transparent reporting procedures. This includes:

  • Use of performance metrics
  • Clear communication to stakeholders
  • Conflict mitigation strategies
  • Ensuring fulfillment of regulatory, compliance and disclosure requirements

Naturally, your accountability and regulatory landscape will vary according to your business’s field of activity, but you can ensure your accountability and transparency measures are irreproachable by adhering to corporate governance best practices.

The role of corporate governance training
Corporate governance training helps you better understand the active role of boards in contributing to the company's success, perfect your knowledge of corporate governance best practices and integrate them into board activities. Programs addressing board governance best practices can also help ensure cohesion in a board of directors.

The best corporate governance training comes from the best business management schools. Executive education rankings from respected publications such as the Financial Times are good way to make a first assessment of the quality of management training courses from different business schools.

IMD, one of the top business schools in the world, offers high-impact and customized board education for board directors, either individually or in teams. Looking at issues such as corporate best practices, board dynamics, the role of the chairman and how to manage boards in crisis, our board governance training helps board members to identify the strategies, structures and processes that make boards the driving force behind their company's success.