Good corporate governance is essential for organisations to achieve their goals and objectives in a secure and effective way, to exercise accountability, efficiency and transparency, and to ensure compliance with all relevant laws and regulations. Social distancing has caused numerous corporations to innovate in order to maintain and even improve governance during and after Covid-19. While some processes and practices have been shaken up, boards remain accountable for leading companies, and many immediately turned to digital technologies in order to do so.
Moving through a crisis
The global financial crisis of 2008 is when many organisations started to realise that we cannot completely rely on human resources to run corporations and that digital tools are becoming central to good governance because they reduce opportunities for corporate crime and corruption. “It was around this time that Board Portals were making their way into the boardroom to help streamline board activities. Innovative organisations were able to handle the crisis a lot better than those that weren’t open to change,” recalls Liam Healy, Managing Director EMEA at Diligent Luxembourg.
By combining automation and technology, financial reports were transformed into certain formats to make them more accessible, thereby simplifying processes and reducing human error. Digital tools increase transparency and limit opportunities for human deception, corporate fraud and corruption. Overall, organisations that shy away from the changes that are created in response to a crisis situation are less well equipped to move through a crisis.
Twelve years later, we find ourselves in a health crisis that has created waves for the corporate world. The initial lockdown rendered it impossible to meet for months, and global travel is still disrupted. As the new processes and technology become familiar, virtual workspaces become part of the standard. The demand for digital tools has exploded this year, and developers have had to evolve rapidly alongside to ensure the products are performant and meet stringent requirements.
As remote work becomes commonplace in areas previously unthinkable, digital transformation has accelerated beyond the organisation. Boards of directors are becoming increasingly reliant on boardroom technologies, which have been improving and diversifying to optimise governance and performance. According to Deloitte, the percentage of boards with meaningful technology expertise is growing because high performing companies are more likely to appoint board directors with some technology expertise. “This wasn’t the case until very recently. Boards were primarily composed of senior managers, and tech know-how was not a consideration,” explains Liam Healy.
Digitalization and technology are being more widely accepted as business enablers across the board. At a time of social distancing, it’s imperative to do what we can to create a more successful remote experience by using digital tools designed for modern governance to empower leaders. The urgency for digitalization has been created by the crisis, but the need was always there and will persist following it.
To embrace boardroom technology and digital transformation is to be a part of the movement towards modern governance. Find out more about digitalization’s seat in the boardroom and how technology can maintain good corporate governance during and after the Covid-19 pandemic .
The largest global network of corporate directors and executives, Diligent is relied on by more than 16,000 organisations and 700,000 leaders in in over 90 countries. With award-winning customer service across the globe, Diligent serves more than 100 fund and financial services customers in Luxembourg. More info on Diligent here .