Corporate Governance for the Future

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1 Response

  1. Pat Bush says:

    Thank you for your insightful article. Your assessment of the responsibilities of a BoD on. The problem as your article pointed out, is a basic problem, a cover up by Senior management on issues which in the long run manifest into major problems and oft times result in criminal activity. What has to be initiated is a two fold process.
    First the Bod has to form an oversight committee within the BoD.
    Secondly, the BoD has to have a senior manager as part of the BoD without a voting right. This individual would be responsible as a BoD member to make sure all problematic issues are placed before the BoD in an acurate, timely manner. Take for example the issues moving forward with the Penn State scandal. This is a blatant cover up of a serious situation that had the BoD and other officials within the organization taken swift remedial action the fallout from this event would have had minimal damage to the organization and the collateral damage would have been suppressed and the image of Penn State would have been preserved.
    However, the opposite took place. With poor internal controls and individuals thinking within the short term benefit arena, the event became a monster with PSU receiving a horrendous negative response to their BoD actions. Damage that is irreparable to the school to their staff and most importantly to the parents/students, who are the stakeholders in this situation. What could have been a simple solution to a problem had the correct controls been in place has turned into a catastrophic event. In your article, you have mentioned every concept of what must be initiated within every board , for every corporation in America and globally. The PSU case should be reviewed as a case study for every BoD globally.

    Thank you