(3) Avoid nepotism and box-ticking in recruitment Nepotism is an easy ?DO NOT? point to make however, beware of misinterpreting meritocracy for mere ?box-ticking?. If your company has a specific set of values (and we hope it does), then these should run through the veins of each employee and potential employee. For each senior hire a board committee oversees the entire process ensuring technical qualifications and sharing of cultural values are given equal weighting. What good is the highest qualified candidate when they are walking in an opposite direction to your company? Like all things corporate governance, putting this into practice is much harder than the intent. However, using ?tip one? and incorporating the broad interests into the recruitment process will help ensure your cultural values are not overlooked when scouting the best talent.
(4) Balance local sensitivity with global considerations This is an issue for any multinational in the world. Different countries have developed at vastly different rates over the past 150 years and the difference can be felt no more than when legal counsel attempt to adhere to different countries? regulations. A tough balancing act comes into play here. How best can you do business in local markets whilst keeping true to your corporate values? Nest now operates across 23 jurisdictions and we know how important it is to ensure that cultural values never become detached from practical regional operations. This is particularly true in jurisdictions where their regulatory structures have not fully matured and are therefore more susceptible to changes. Here, a healthy, collaborative relationship with the regulators is vital for both parties. Firstly, the regulator requires and normally seeks the views of those it is regulating. Likewise, the company being regulated needs to voice its concerns and needs before definitive frameworks are laid down. On a number of occasions, we have been officially invited to contribute to the local discourse on how to implement effective and appropriate corporate governance, which we were always happy to participate in through intellectual contribution as well as on-the-ground action. A perfect illustration of this in action was our compliance with Solvency II. Our strong focus on best practice at all times ensured one of Nest Investments insurance subsidiaries was amongst the first entities in Cyprus to comply with all new industry regulations, ahead of most of the competition ? a win for the regulators and the group.
(5) Have the ability to act when things go wrong Once the structures, processes and people are all in sync to ensure great corporate governance, the variety of obstacles that life throws at your business means that recovery will be required at some point. In these scenarios it is essential that internal controls are in place to ensure a rapid response. This is particularly true in the jurisdictions which are less than stable. As a large group with many subsidiaries we have a system whereby all data from around the world is centrally analysed and easily accessible by the directors and managers on a frequent basis to ensure smooth operations and note any red flags early on. With a large operation in place in Libya before the fall of Gaddafi, this mechanism led to the most efficient way out of what could have been a tricky situation. We were able to assess the prevailing circumstances (business integrity, security and freedom to move in and out of the country) in Libya and take the decision to pull out until such time when it is possible to resume safe and legal operations, in an environment conducive to operating a successful business. These internal controls ensure that the group can check and monitor all our subsidiaries? values and behaviours ? and act fast when things go awry. Conclusion In light of global and regional turbulence it is easy to be put off getting your business involved. But in our view if there is one thing that the business world can add in the pursuit of the antidote that we all seek then that is effective corporate governance. Ghazi Abu Nahl is the founder and chairman of Nest Investments
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