The performance of corporate boards is being scrutinized by a public that has become increasingly skeptical in the wake of regularly-revealed corporate scandals. Is there a better way? While no system of governance can guarantee ethical behaviour, there is an approach to governance – the Policy Governance model – that can position boards to be certain they have fulfilled their accountability to their shareholders. The model can be characterized as an “operating system for boards.” Rather than tinkering with individual aspects of governance or applying band-aid solutions, the model presents a complete theory of governance that is conceptually intact, with a set of principles that are internally consistent with one another. Foundational to the theory is the concept of the board as agent of the ownership, fully accountable to them for the performance of the company. When applied together, these principles allow a board to demonstrate clear accountability to shareholders. This presentation explains the principles of the model, and how it can be applied to corporate boards.

The Policy Governance model is an “operating system” for boards, derived from a conceptually complete theory of governance, and comprised of the smallest number of universally applicable principles necessary for it to function effectively as a system. This system can position boards to demonstrate accountability to their shareholders in relation to all aspects of a company’s performance, including appropriate management of risk. Sir Adrian Cadbury (1929-2015), former chairman of Cadbury Schweppes and author of the 1992 report that set the standard for corporate governance, said it is “as near a universal theory of governance as we at present have.” He went on to say that “Its universality provides a benchmark against which to measure the quality of existing governance models of all kinds.” Using the model allows a board to demonstrate accountability, while at the same time the CEO has clear expectations and operating freedom within known limits. The principles of the model can be applied to companies of all sizes.  This presentation will address how the model can be used to shape a company’s risk culture:

• Values as the fundamental determinant of a company’s risk culture
• A board policy framework to identify and manage risks related to operations and governance
• The importance of “sized” policies in managing risk
• Clarity about who is accountable for what
• A systematic approach to monitoring for accountability

A fresh look at the job of governance—we will consider a model that provides a logical framework for the job of the governing board, enabling the board to use its valuable time most effectively.

• How does the job of governance differ from management?
• What is the “value-added” that the Board brings to the organization?
• How does the Board effectively discharge its obligation of trusteeship on behalf of those for whom it governs?

This presentation addresses board structure and process issues, including:

• How can the Board structure itself for maximum effectiveness?
• What is the Chair’s role?
• How can the Board design and use committees effectively?
• Does the Board Chair have more authority than other board members?
• How can the Board plan effective meetings?
• What is the Board’s own responsibility for an effective process?
• Is the Board’s agenda owned by the Board or the CEO?
• How should the agenda be developed? Who develops it?
• What kind of information should the Board receive? Who decides?
• How does the Board evaluate its own functioning?

Some would argue that the roles of managing and governing are so complex that it is impossible to disentangle them to have a clear understanding. While both are focused on achieving the mission of the organization, the Board and the CEO each have different roles to play. Just as an effective baseball team must have clear rules, so too an effective Board-CEO team.

• What is the board’s job?
• What is the CEO’s job?
• Where is the line between board and CEO?
• How does the Board delegate authority to the CEO?
• How can the Board effectively monitor the use of that authority?

This session will address the components of good governance that maximize the value of the Board’s contribution to its organization.

• What constitutes effective leadership?
• How can board members focus their time and energies on areas in which they can have the greatest positive impact?
• What are the tools that enable Boards to make the best use of their time, work together more effectively, and clarify their role in relation to management?