102. What is GOOD Governance?

I'm putting a definition of "good corporate governance" out there just so that you know exactly what I mean when I refer to good governance. Feel free to let me know what you think.

Background music is Of the Stars by KC Roberts & the Live Revolution

 

SCRIPT

Welcome to season three of One Minute Governance. It’s been a long break, and it’s good to be back. I signed off the last season with a bunch of unfinished business, including a threat to write a book. Lots more to come on all of that very soon. In the meantime, let’s kick off season three by revisiting the heart and soul of what OMG is all about. You all know by now that I like to define corporate governance as “the way that decisions are made in a corporation…meaning ANY incorporated entity regardless of structure, purpose, size, or complexity.” A lot of people have a hard time with this definition because it doesn’t say anything about boards, or managers, or rules, or processes, or anything like that. Putting it another way, my definition doesn’t tell anyone what they should be DOING. I mean, decisions can just kind of happen, right? Without anyone thinking about or doing anything at all. Well, in my opinion, just letting things happen is still corporate governance, for better or for worse. But is it GOOD governance? What does GOOD governance even mean in the first place? I’ve thought about this a bit over the past few months and think I have an answer that will at least serve as a good starting point for season three. Here it is: Good corporate governance means creating conditions that maximize the likelihood that effective decisions will get made. There it is! It might not sound like much, but sit with it for a while before accepting or rejecting it entirely. I’ve had a couple of months to live with it and you know what? It grows on me more each day. Welcome to a new season of OMG.