Good governance is not more governance

Good governance is not more governance

More controls, more committees and more reporting can create the appearance of stronger governance while making real accountability harder to see.

By Sabine Said

The instinct to add

Something goes wrong. We add a control. Something else goes wrong. We add a committee. A reviewer asks for more evidence, so we add a report. After a few years nobody remembers why half of them exist, but removing any one of them feels dangerous. This is how governance accumulates: usually with good intentions and rarely with a deliberate end-state in mind.

Every control should earn its place

A useful control should be able to answer a few basic questions. Which risk does it address? Is it preventive or detective? Who owns it? Why is the frequency appropriate? What evidence shows that it works? And what happens when it identifies an exception?

Some controls are prescribed by regulation. That does not remove the need to implement them thoughtfully or justify the additional layers built around them.

If the answer is simply “we have always done this monthly”, the control may still be valid. But it probably deserves a fresh look. Risks change. Systems improve. Activities disappear. Controls have a habit of surviving all three.

Committees need a job description too

A good committee should know whether it exists to advise, challenge, coordinate or decide. Problems begin when every forum tries to do all four.

Discussion is useful. Challenge is essential. But if a decision can only be made after it has visited five committees, governance may have become a very sophisticated form of delay. Worse, everyone may have discussed the matter without anyone being clearly responsible for the outcome.

Markets, clients and regulators rarely pause while an organisation completes its internal choreography.

Clarity beats accumulation

Boards and senior management already receive extraordinary volumes of information. Often, the difficulty is identifying what changed, what sits outside appetite, what needs a decision and who owns the next action. Those answers belong at the front of the board pack. Supporting detail belongs behind them.

I am all for documentation. This is financial services; undocumented brilliance tends to have a short regulatory half-life. But documentation should support accountability, not substitute for it.

More governance is easy to demonstrate. Better governance is harder. Its practical test is whether people know who decides, who acts and who follows up—and whether that is what actually happens.

This article reflects the author’s views and is intended for general information and discussion. It does not constitute legal, regulatory or investment advice.