The importance of good governance for businesses

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In the latest UK200Group blog post, Tony Newman ACA FCCA, Partner at George Hay Chartered Accountants discusses the importance of not underestimating the value of good governance.

Tony Newman
In today’s business landscape, we are no stranger to stories of business failure and company collapse and it’s not just smaller enterprises that are experiencing this, but big companies and well-known names.

Whether a business succeeds or not can depend on any number of things but the bearing that good governance can have on a company’s trajectory is often underestimated, particularly amongst SMEs.

What is corporate governance?

In broad terms, it refers to how a business is managed and the systems and processes that are implemented to support that. Good corporate governance, in many respects, is essential for the maintenance of a stable economy, as it allows businesses to be flexible, resilient, responsive and, therefore, sustainable.

The benefits of good governance

Whilst it’s true that corporate governance is very much geared towards big business, this isn’t to say that SMEs cannot benefit from adopting some form of governance arrangement that is suited to their needs.

Effective governance practices and solid internal controls should serve to protect and future-proof your business. Your strategy should mitigate risk, promote better decision-making and ultimately help you to achieve better results for you and your team.

Opting in to corporate governance can be key to long-term and often faster business growth. If done properly, it should enable you to visualise where you are headed, break your goals down into achievable objectives, align your processes accordingly, monitor your progress and adapt as the world around you changes.

Whilst some smaller businesses realise that good governance is important, without the input of an external adviser, they often remain unsure about how to put it into practice.

Our role as advisers…

Often, it is all too easy to let the day-to-day running of your business cloud the bigger picture. That being said, the failure of a business can be devastating; leaving financial trauma and a whole host of worries in its wake.

In light of this, it’s important to take a step back and consider whether things are going the way that you would like.

Whether you’re a start-up, or an established company, we can work with you to consider your next move, formulate your strategy and develop your business. We are highly experienced in putting together management accounts, cash flow forecasts, business plans and due diligence reports to help you make the right decisions for your business.

We understand your challenges, so to explore how we might be able to help you and your business, take a look around our website, or contact us today to speak to one of our team.

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