Introduction: corporate governance

Corporate governance - it’s about how a company or a public sector entity is managed. It’s the systems in place to make sure those in charge are running it the way it’s supposed to be run. In private companies, it’s important to meet the needs of shareholders. After all, they’re the ones investing. In the public sector, it’s important that decisions are made in the interests of, you guessed it, the public. So how do we ensure that all managers in the private and public sector are acting in our interests? There are three kinds of issues when we want to keep a manager under control. Firstly, the manager may be putting his or her own goals first.

Bad move - it’s not your ambitions you should be focused on. Secondly, information gaps - managers are entrusted to make decisions in the best interests of the company or entity, while nobody checks what they do on a constant day-by-day basis. Thirdly, performance measurement - we should measure and appraise the results of the efforts of the managers and reward them, depending on the performance. Is the manager being given enough of a reason to excel, and is performance being properly tracked? To make sure the public sector is properly accountable, there are a number of principles that organisations need

to follow: clearly defining goals, roles, and responsibilities, efficient use of resources, making sure activities are properly reported, performance reviews of those accountable. Four steps, four fundamental ways to make the public sector better for everyone.