Who says Corporate Governance is dead?
Corporate Governance is dead! says John Richardson. http://globalinvestmentwatch.com/corporate-governance-is-dead/
Corporate Governance that is dead and was doomed to die was the wrong kind – it catered only to shareholders who needed shot term gains to make a quick buck from the market and had turned it into a veritable casino. They had little stake in companies they invested. Their short termism encouraged concealment, cosiness, conceit and corruption. Instead of improving things they focused on HNTGC (How Not To Get Caught). They perpetuated the opacity of the markets by bringing destructive derivatives, hideous hedge funds and plunderous private equity, rapacious CEOs and drunken directors demanding king’s ransom for “independence”. That was a device that encouraged groupthink, insider trading, falsification of accounts beefing up valuations and returns through financial engineering, imaginative spreadsheets and mathematical modelling. That beast is thankfully dead after the market meltdown.
Corporate Governance that has survived after the Amrit manthan of 2008 is empowering the boards to become instruments of change and innovation and deliver all around value – not just financial but more importantly social and environmental taking 360 degree approach going beyond even the triple bottom line by empowering people and fostering their commitment through deep emotional involvement. Companies practicing this corporate governance use employees their most valuable asset – far more than venture capital obtained at prodigious costs. They constantly disrupt the status quo, harnessing every turbulence including the climate change as an opportunity for creating wealth. New corporate governance is not based on rules but principles driven inside out where boards lead by example, value dissent, celebrate diversity, deepening disclosures to enhance trust and improve quality of dialogue and debate. That helps them to confront new ideas and innovation. They focus on turning their business into a cause that elicits commitment of each staff and empowers each employee to do their bit. They believe in differentiating their businesses to deliver value to customers. Their mantra is iTEAR –innovation, Transparency, Engagement, Accountability and Responsibility. They have a fetish for transparency and constructive engagement. They believe that in this world of change and uncertainty , no one person has all the answers. Only the truly transparent who share their problems with others and wear their failures as badges of honour will survive. They don’t believe in succeeding at all costs. They pride in personal morality and ethics beyond anything else. For them glory lies not in succeeding every time but rising faster each time they fail.
