Principles of Good Governance

A governance strategy helps leadership teams determine the policies, processes, and corporate structures that guide employees in fulfilling the organization’s mission and abiding by its values. 

Governance contextualizes and codifies conduct by setting expectations and boundaries for personnel and their activities. In highly competitive labor markets where good talent is scarce, organizations must ensure that their corporate culture attracts and incubates world-class talent.   

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4 Attributes of Effective Governance 

Good governance is not developed in a vacuum. It is carefully considered, planned, and organized to enable the entire organization to thrive as a cohesive unit. For a governance management strategy that empowers teams and individuals to produce the best outcomes, organizations need to prioritize:  

1. Compliance

Good governance requires policy adherence. Organizational policies should comply with laws and regulations, consider the general consensus of personnel, encourage responsible and ethical work, and protect the rights and safety of the workforce. 

2. Transparency

Policy development and enforcement must be approached in an open manner that fosters trust among employees, stakeholders, and partners. 

3. Agility

Organizations need to be able to move quickly and adapt their processes to meet objectives and serve stakeholders. Institutions that have the foundation of a strong culture supported by sound policy can respond to changing circumstances, making decisions that align with organizational strategy and values. 

4. Inclusiveness

Effective governance decisions consider employee wellbeing, ensuring that each member of the organization is treated with respect and that discrimination is prohibited. Good governance also recognizes that fostering diversity and different perspectives enables better outcomes and provides a competitive advantage.

Read next | Why Governance Is the Foundation for Organizational Success >