What does good governance look like for an independent agency?
‘Good’ governance takes many different shapes. At its core, it’s about tailoring the systems that direct or control the business, to the size/structure/needs of the business, and using those systems to drive accountability and performance.
One end of the spectrum is the boards of ASX listed entities. The other is, well, having nothing. Most agencies seem to fall into the latter bucket.
The challenge arises when the director/s (usually also the main/sole shareholders, CEO, CFO, etc… the life of a founder) don’t have the time or knowledge to properly complete all of their many roles – particularly that of a company director.
To my mind, a great solution for small businesses is starting with an advisory board.
This can be as formal or informal as you’d like, but starts setting the groundwork for a path to good governance. It’s non-binding, and you can (should) fill the board to complement your strengths and weaknesses.
As you progress, this can become more formal, allowing founders to step into board positions rather than being ‘in the business’ every day – something key that comes up if you start thinking about a sale!
Leave a Reply