Today Baltic Institute of Corporate Governance (BICG) launches its latest publication, titled “Guidance on Board Effectiveness – Handbook for State-Owned Enterprises (EE, LV, LT)”
This publication is the latest in a series intended to build a more profound understanding of how governance works in the Baltic States, and to develop suggestions for how to implement world class standards in the Baltic region.
This time we have uniquely taken a UK guidance from the Financial Reporting Council and adopted it for the use in the Baltic States. The handbook is an adaptation of the Financial Reporting Council (UK), “Guidance on Board Effectiveness”, originally published in March 2011. The appendix section mainly draws from the preceding document from FRC, “Good Practice Suggestions from the Higgs Report”.
Additionally, we have added reference to relevant OECD publications.
This new handbook has been developed to improve the work in the boards of the SOE’s in Estonia, Latvia and Lithuania, and help the parties involved create international best practice boards.
The target audience for the handbook is current and future board members, both when they are from the public sector and the board assignment is a part of their day-to-day job, and when they are independent board members from outside the Government.
We also believe this handbook will be valuable for Government Ministers, officials and Parliamentarians that are overseeing SOE’s and perhaps are involved in nominating board members and communicating with the SOE’s.
Finally the handbook should act as a window to the public, so they might understand what to expect when we manage these valuable assets on their behalf.
Key points in the Guidance on Board Effectiveness:
- The board’s role is to provide entrepreneurial leadership of the company within a framework of prudent and effective controls, which enables risk to be assessed and managed.
- An effective board develops and promotes its collective vision of the company’s purpose, its culture, its values and the behaviours it wishes to promote in conducting its business.
- An effective board should not necessarily be a comfortable place. Challenge, as well as teamwork, is an essential feature. Diversity in board composition is an important driver of a board’s effectiveness, creating a breadth of perspective among directors, and breaking down a tendency towards ‘group think’.
- Good boards are created by good chairpersons. A chairperson creates the conditions for overall board and individual director effectiveness.
- A non-executive director should, on appointment, devote time to a comprehensive, formal and tailored introduction, which should extend beyond the boardroom.
Guidance on Board Effectiveness – Handbook for State-Owned Enterprises (EE, LV, LT)
For additional information:
Kristian Kaas Mortensen
President
Baltic Institute of Corporate Governance
km@corporategovernance.lt
+370 611 133 44
Notes for editors on BICG:
Established in August 2009, Baltic Institute of Corporate Governance is a non profit, non governmental association with strong involvement from the Baltic business and political leaders.
BICG delivers value to its stakeholders by promoting global competitiveness of Baltic companies through adoption of leading corporate governance practices.
