What is a corporate governance handbook, why is it needed and how does an organisation create one? The purpose of this guide is to answer these questions.
The key points covered in this guide include:
- How a governance handbook allows executives to understand their duties and obligations;
- Why the handbook must contain details on regulations in addition to external controls;
- The role of the handbook in how people should behave and how the board should function;
- How the handbook should inform board members of their legal responsibilities, and;
- Why a good governance handbook is an excellent way to ensure the organisation is run effectively and meets all of its obligations.
Essential elements of a corporate governance handbook include:
- Details of how board meetings should be conducted and the provisions to ensure smooth functioning.
- Descriptions of board committees and their roles.
- Policies regarding delegation of duties should be described.
- An outline of the subsidiaries of the company and their role and purpose.
- How the board should determine the planning and reporting requirements and how the board and members’ performance will be evaluated.
- A good governance manual should include details of protections from legal claims and insurance for board members.
- The handbook should also explain the agendas and reports in place, the policies for appointing board members, and how they will be remunerated.
The corporate governance handbook provides a company’s executives, directors, and shareholders with a complete overview of corporate governance practices and frameworks. It is a practical toolkit for implementing good governance.