4 Corporate Governance Tips for Your New Corporation

Posted on: 6 July 2021

As someone overseeing a new corporation, you might eventually shift some of your focus away from products and services so that you can create a comprehensive structure for the company. It may be time to streamline your corporate governance—the framework in which you'll lay down rules and various protocols and procedures. How?

Create Employee Manuals

The best way to ensure everyone understands the rules you're creating is to compile a manual for every employee. Sick leave, vacations, disputes, and other work-related protocols and rules should be included. Have everyone submit a signed document saying that they've read and understood everything in the manual. When new hires come on board, part of their orientation process should include the manual.

Outline the Board's Role

If this is the first time you and your peers are participating in a corporation with a corporate board, it's vital to arrive at a scope of work for board members. Everyone should have a clear understanding of what the board does and does not do. Primarily, the job of most corporate boards is to find, hire and meet with the company CEO. Different corporations have slightly different tasks for their board members, but everyone on the board must agree on what those tasks are.

Be Honest About Your Own Role

If you started the company and now find yourself working with other people at senior levels of management, you might feel eager to jump into the CEO role. However, good corporate governance depends on the right people in the right positions. That's when you need to take a step back and be honest about your skill set, passions, and goals.

For instance, would you rather work on new products and research or focus on business tasks and expansion? You need not take the CEO position if your skills are better used elsewhere. You might, for example, take the chairman of the board role so you can veto decisions, but then have time to work more directly with the company's products and services.

Schedule Independent Audits

Even if you work with fantastic, highly skilled people, there is always room to improve. It's smart corporate governance to regularly schedule independent audits of your company. This can ensure that everyone is performing well and that the business itself is in good shape. If there are problems, an audit will reveal them.

Corporate governance is essential for a growing corporation. If you need help creating a solid framework, seek out corporate governance services that can help you create the right system for your company.