Headlines from the first quarter of 2023 have shown us what we all should know by now - the only constant is change. Most recently, thousands of layoffs in the tech industry, the collapse of SVB, and the continued ripple effects of that collapse in the financial markets have caused anxiety among job seekers, employers, investors, and anyone who reads the news.
As governance and board professionals, it's easy to look back and find issues that led to each of the new crises we read about. We can also take a look at our own governance programs, frameworks, and methods and hopefully receive comfort as we face the future.
In uncertain times, governance fosters stability and predictability, which in turn provides comfort during periods of upheaval or unpredictability.
Getting lost in chaos in confusion is easy when the unexpected occurs. Governance provides clarity and structure, which helps individuals and organizations better understand what is expected of them. During a crisis, having a strong framework of governance in place can help people make sense of what is happening and understand their role in responding to the situation.
Having a system of accountability in place during times of uncertainty is critical. Governance provides this by setting clear standards for behavior and outlining consequences for non-compliance. In times of crisis, knowing that those in power are accountable for their actions can provide comfort to those who are feeling uncertain or vulnerable.
Governance provides stability, which is essential during times of uncertainty. Through policies, regulations, and frameworks, governance can help stabilize the economy, the political system, and society as a whole. This stability can help dispel anxiety and provide comfort to those affected by the crisis.
When we are facing a new future, people need someone to trust. Governance provides this by establishing frameworks of trust and legitimacy based on established norms and practices. By having a system in place that fosters trust, individuals are more likely to have confidence in the decisions made by those in positions of power.
Governance provides consistency, which is important during times of crisis. Consistency in decision-making and policy ensures that people can rely on certain expectations and helps reduce uncertainty. Knowing that there is consistency in the way things are being handled can provide a sense of comfort during uncertain times.
Good governance involves being prepared for potential crises. By having plans and procedures in place, those in positions of power can respond more quickly and effectively to uncertain situations. This preparedness can help reduce the severity of the crisis and ultimately provide comfort to those affected.
While governance provides stability and consistency, it also needs to be flexible enough to adapt to changing circumstances. During times of crisis, flexibility is essential for effective decision-making and action. Governance structures that are designed to be adaptable can help provide comfort by demonstrating that the system is responsive to the changing needs of the situation.
Good governance involves collaboration and communication between different stakeholders. Faced with riskiness, collaboration can help provide a sense of shared responsibility and accountability. Collaboration can also help ensure that resources are used effectively and efficiently, which can provide comfort to those who may be impacted by the crisis.
Transparency is an essential aspect of good governance. Transparency in decision-making and communication can help build trust and accountability, which are critical during times of uncertainty. Transparency can also help individuals understand how decisions are being made and what impact those decisions will have on their lives.
During times of uncertainty, it is important to ensure that everyone is being treated fairly and equitably. Good governance involves ensuring that policies and decisions are made with the best interests of all stakeholders in mind. By ensuring that everyone is being treated fairly, governance can provide a sense of comfort to those who may feel vulnerable.
Let us know what your top reason is for loving corporate governance and we’ll share how Govenda can be your board governance partner.
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