Tenets of Good Corporate Governance examined in new ACCA report
New report in tenets series helps businesses consider corporate governance in relation to long-term future
Toronto, May 9, 2018 – The Association of Chartered Certified Accountants (ACCA) released a report today titled “Tenets of Good Corporate Governance,” examining the interrelation between businesses and society, and the importance of good corporate governance in facilitating a positive relationship between them.
“This is a terrific report by ACCA, and a must-read for all North American company directors and governance professionals,” says Richard LeBlanc, associate professor of law, governance and ethics at York University in Toronto. “It reflects best global take-away practices for leading, value-added boards, and captures key trends and debates that are occurring in American and Canadian boardrooms.”
Because the focus of the corporate governance debate is shifting from an emphasis on compliance with processes and procedures to the outcomes of applying them, the ACCA published the “Tenets of Good Corporate Governance” to explore some of the key topics and issues in global corporate governance practice and debate, including five key issues:
• The relationship between companies and society
• Diversity and balance
• Enabling an effective board
• Executive remuneration
• Gatekeepers of corporate governance
The report highlights the need for companies to think deeply about their business model and how it may look in 5, 10 or 20 years’ time. Companies need to achieve their long-term business purpose, but this must also involve picturing where the society is going, and how they fit within the vision. Businesses need to realize the importance of a motivated and engaged workforce and positive relationship with their environment.
“While the corporate governance debate has come some way over the last decades, many still see it as a compliance exercise,” says Jo Iwasaki, head of corporate governance, ACCA. “However, some companies are exceeding existing best practice which, combined with a change in public perception, should raise the standard of practice over time.
“Hopefully this report helps businesses to examine their vision and strategic direction in a broader context, which will in turn allow their companies to achieve long term growth.”
Tenets of good corporate governance is the latest report in ACCA’s tenets series, which also includes the tenets of tax, business law and corporate reporting. “ACCA should be commended for such a timely, relevant, balanced and useful contribution,” says Leblanc, who contributed to the report.
Colin Ellis is managing editor of Canadian Accountant.