There is always something happening in Corporate Governance.
Two recent notable items are —
- Corporate Governance is Top Challenge for Companies Considering an IPO, KPMG Survey Series Finds
- Annual Global CEO Survey by Price Waterhouse Coopers (PWC)
KPMG and the New York Stock Exchange-Euronext recently offered IPO Bootcamps for companies considering an initial public offering (IPO). Participating companies were asked to name their top three challenges in preparing for an IPO. The results are a bit surprising. The top three items were –
- improving corporate governance (64 percent)
- preparation of a robust business plan (40 percent) and
- preparation of financial track record (36 percent).
Often, it’s the small details that companies overlook that can cause headaches down the road. For example, while many companies realize that corporate governance is a demanding issue, when selecting board members, many don’t consider that an important role for directors is working with management to ensure the right tone at the top for ethics and compliance. (Aamir Husain, a partner in KPMG LLP)
This is encouraging. Fostering compliance and ethics at the early stage of a company’s formation increases the likelihood that these issues will be properly executed as the company grows.
The PWC CEO Survey is extensive but some key items stand out:
- most CEOs outside of financial services believe the economic crisis has not changed public perceptions of their industries. They believe the trust issue is restricted to the banks and isolated to countries that experienced the worst banking crises.
- The view that companies can rebuild trust through new remuneration models appears to be held by a minority of CEOs from virtually every country.
While small start-up companies realize the importance of trust and ethics, CEOs at large established companies (at least according to the PWC Survey) still don’t get it.
Ed Konczal has an MBA from New York University's Stern School of Business (with distinction). He has spent the last 10 years as an executive consultant focusing on human resources, leadership, market research, and business planning. Ed has over 10 years of top-level experience from AT&T in the areas of new ventures and business planning. He is co-author of the book "Simple Stories for Leadership Insight," published by University Press of America.
