Improving Governance with a Board of Director’s Portal
By Mark Anderson, CEO/CFO | Posted March 27, 2017
A board of director’s portal can play a major role in supporting the kind of information sharing, decision making, and risk management that create better corporate governance. More specifically, a board of director’s portal can promote the accessibility of information, collaboration, data retention, and compliance documentation—all within an secure online environment.
Corporate Governance Primer
The term “corporate governance” isn’t cut-and-dried. So before we dive further into the topic, let’s do a quick overview of what it means. Corporate governance refers broadly to the rules, processes, or laws by which businesses are operated, regulated, and controlled. Or more simply put: It’s the system by which companies are directed and controlled.
That control is shaped by both internal and external factors. Internal factors are typically determined by the officers, shareholders or constitution of a corporation. External factors are formed by clients, consumer groups, government regulations and even suppliers and creditors. Primarily, boards of directors are responsible for the governance of their companies. (Shareholders, of course, are responsible for appointing the directors and auditors needed to make sure an appropriate governance structure is in place.) In theory, well-defined and enforced corporate governance provides a structure that works for the benefit of everyone concerned by ensuring that the organization is following accepted ethical standards, best practices and formal laws.
What’s more, good governance can improve transparency and accountability within the organization’s existing systems. And this can have extensive impact. Governance can facilitate effective and prudent management that promotes the long-term success of the company.
Greater Focus on Governance
In their governance role, boards of directors have a variety of responsibilities, including setting the company’s strategic goals, providing the leadership to put them into effect, supervising the management of the business and reporting their stewardship to stakeholders. Government regulations and other requirements have placed significant legal and financial responsibility on boards of directors to ensure that they fulfill their fiduciary duty to shareholders.
This has driven many companies to increase the number of outside, independent directors on their board. It’s also led to more frequent meetings, increased information review, and increased communications between meetings. A board portal can help busy directors meet the demands of their expanding role.
Ways to Enhance Governance with a Board of Director’s Portal
So exactly how can a board of director’s portal improve governance? A board portal can securely support board communications and activities as well as provide a legal record of certain documents that external auditors require. In other words, a portal provides a single platform for managing board and committee meetings, risk, decision making and other governance-related activities.
A board of director’s portal gives users electronic access to meeting agendas and other board materials. They can also view policies, procedures, company news and other important information, making it faster and easier to perform their duties. Here are some specific areas where a board portal can promote better governance:
- Availability of Information: A board portal provides instant access to meeting materials and corporate information, so directors can make timely decisions and take advantage of emerging opportunities for their organization.
- Centralized documentation: A board of director’s portal creates a place where organizations have centralized documentation organized in an audit-ready format that can give regulatory inspectors quick access to requested data. This also lowers the chance of records being unavailable, incomplete, inaccurate or even lost.
- Convenience: Because directors can view corporate information remotely, they don’t have to be in the same place to be able to discuss the same documents. They can talk about an upcoming strategy, decision and other important details no matter where they’re located.
- Communication: Directors can communicate in real time about the latest updates on pre-board meeting files and other information, so they can make well-informed decisions.
- Collaboration: A board of director’s portal lets users access the information they need, including discussions of previous meetings, past decisions and meeting minutes, so they can collaborate and make better decisions.
- Accountability: All documents that go through the board portal are version-controlled, which means it’s easy to tell who has access to different data and who made changes to any given file. So directors and authorized users can be held accountable for the changes they make within this audit trail.
- Information security: Thanks to comprehensive security features and strict protocols, sensitive information about the company, customers and employees is protected during transmission and storage inside the board of director’s portal.
Studies show that well-governed companies perform better. So consider using a board of director’s portal to improve your corporate governance.
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