Integrity, Culture, and Other Intangibles for Building Long-Term Value--The Board's Critical Responsibility
Governance is a discipline different from management. Understanding that concept is the first step toward improving board practices. While management designs, recommends to the board, and executes the company s strategy and business plan within an...
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| Format: | Brief |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2014
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| Online Access: | http://documents.worldbank.org/curated/en/2013/01/17630460/integrity-culture-other-intangibles-building-long-term-value-boards-critical-responsibility http://hdl.handle.net/10986/17039 |
| Summary: | Governance is a discipline different
from management. Understanding that concept is the first
step toward improving board practices. While management
designs, recommends to the board, and executes the company s
strategy and business plan within an agreed budget,
governance focuses on active, vigorous oversight of the
company and its management. This paper presents a practical
guide for boards on how to fulfill their responsibilities of
being the guardians of integrity and their company s culture
by discussing common causes of board failures. Stressing
that relationships based on integrity add value to
organizations, contribute to their sustainability, and
promote their reputation, Stout points out the board s
responsibility in creating and maintaining such an
organizational culture. Several key topics are explored: the
commitment of the directors, the ideal board composition,
the fiduciary duties of directors, the selection of the
Chief Executive Officer (CEO), the role of directors in the
creation of internal controls, the remuneration of directors
and officers, and risk management. Furthermore, Stout
defines the role of the board with respect to relationships
with stakeholders an issue that in many companies ends up
being the focus only of management s attention. |
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