Our Two Hats
In small businesses it is often a reality that shareholders and directors are the same people. We are taught that the company is a separate entity, but that the people influence the culture. Ultimately the entity serves people, who thus have a vested interest in its success.
This is all fine and well theoretically, but when the roles are not vested in separate people, these conflicts may result in failure. So, what to do if this is your reality?!
My advice would be this – I have learnt a simple rule. Segment the roles in your mind.
Critically think which functions and decisions all in which role. In other words, is it an operational issue ? Then it is a decision for a director forum. If it is an investment question – then it is about shareholding and falls there.
The Year Twenty Plenty
That leads me to what twenty plenty means to me …. It will be a year of absolute clarity, where all the lessons learnt will be applied towards the creation and building of structures and mechanisms that positively impact and change the lives of others.
Lessons from an economically strapped year….
For most businesses in South Africa, 2018 and 2019 has been tough. Who knows what 2020 will bring?! One thing is sure, the lessons learnt will be a “feather in the cap”, and I for one, choose to see the silver lining. When we know, more we can do better. Let us focus on […]
I don’t have time…
They say business is a delicate combination of a war and sport. In the last 8 weeks, this could not be more true for me. In business there are always seasons and challenges, that is a given, specifically, when the operational chaos is all-encompassing, and you struggle to keep your eye on the goalpost. Sometimes […]
Why are having good ideas crucial in business?
Introduction Having great or innovative ideas is something most technology businesses thrive on and need to stay relevant. Perhaps even businesses traditionally associated with creative thinking. But should this concept be limited to only these businesses in today’s day and age? I say no – it should apply to all businesses! This is a question […]
The link between board composition and financial performance
We have been hearing buzz words like board diversity and of course directors duties, but what is the true link between the board and ultimately the shareholders? Well, its all about performance. All about steering the ship in the right direction. The ability to steer is all about who you have at the wheel as well as how the team operates.
According to Parmi Natesan, CEO, Institute of Directors in Southern Africa:
“Research shows what most shareholders probably instinctively know: that the experience, expertise and ethics of board members directly affect the quality of their investment in the company.”
“The MTN case provides an example of how board changes can impact the market. Shareholders should bear this in mind, and ensure that boards not only have the right skills, but also that well-thought-out succession and rotation plans are in place.”
One research paper into the correlation between board composition and financial performance of listed companies concludes that “board structure does play an important role in influencing firm performance. There is practices a need to monitor and practice the different elements of a corporate board to ensure good corporate governance practices are upheld.