Update Spring 16

Is corporate governance effective?

According to the OECD, good corporate governance is the means by which economic efficiency, sustainable growth and financial stability can be supported. It facilitates access to capital for long term investments and helps ensure that shareholders and other stakeholders are treated fairly.

While corporate governance rules and practices have improved in many countries over the last decade, there is still much to be done. As the VW case shows, when the board is not on top of what is really going on, the consequences are far reaching.

In the last five years Toshiba, Tesco and VW have all dealt with expensive and highly damaging scandals, begging the question are boards sometimes asleep at the wheel? Are the corporate goals balanced with the need to manage risk and protect reputation?

While boards do have a fiduciary duty to deliver returns to shareholders, long-term sustainable success involves more than producing favourable quarterly returns.

Real sustainability needs the key components of effective board practice to be firmly in place, namely the underlying principles of all good governance: accountability, transparency, probity and a focus on the long-term.

GoodCorporation is increasingly being asked to advise on effective governance practices as well as ethical conduct and responsible business management.

If you would like to talk to us about testing, strengthening and embedding effective corporate governance, please get in touch.

Michael Littlechild

From Safe Harbour to Privacy Shield

Following the European Commission’s decision to overturn the framework through which the personal data of EU citizens is protected when transferred to US organisations, there have been protracted negotiations to provide a viable alternative.

A replacement framework has now been announced, known as the EU-US Privacy Shield. The new arrangements aim to impose stronger obligations on US companies to protect personal data and ensure greater enforcement measures by US authorities. It also aims to provide increased rights of address to EU citizens.

However, as the Privacy Shield is yet to come into force and guidelines as to how companies should proceed have not been produced, how should organisations respond? Doing nothing and waiting for the details to be announced is not recommended.

The goodblog lists a number of steps for consideration, including incorporating model clauses into contracts, establishing an approved set of binding corporate rules or employing anonymisation techniques. Companies can also use our Data Protection Framework to assess provision.

Our next Business Ethics Debate will look at enforcement and non-compliance risks in light of both the forthcoming Privacy Shield and the General Data Protection Regulation. Jonathan Bamford from the Information Commissioner’s Office will be speaking. If you are interested in receiving an invitation to this debate which is taking place at the House of Lords on May 26, please contact us.