Governance and shareholder value

Posted: October 3, 2023 // Author: Board Originator Ltd.

Without governance, firms under-perform.

The International Monetary Fund has been saying so, since 2016. 

When governance is missing, the problem for companies is:

  1. Likely damage to reputation and brand
  2. Loss of shareholder trust and confidence
  3. Risk to value generation
  4. Risk of regulatory sanction
  • Governance is the answer – because global markets become stronger, deeper and more resilient – when fuelled by smarter Boards.
  • Governance is a key way to ward off insolvency investigations, a particularly big risk in higher interest rate environments.
  • In really positive terms, “the strongest governed companies…. deliver double the shareholder value over a ten year period”, says Grant Thornton UK.

We at SEEIO work hard to scaffold firms – of all sizes and locations – in the SEEIO digital governance collection of power tools. SEEIO scaffolds firms because the governance power tools help firms:

  1. boost resilience
  2. Takes heat out of shocks
  3. Improve borrowing prospects and reduce risk of default
  4. attract the best talent, including director talent.

80% of companies could attract investment from Venture Capital and angel firms.  Ambitious companies can join private market exchanges or seek crowd funding if their governance is in good order: good governance, good metrics, targets met, and tidy records.

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