As organizations are becoming more and more global, their need for and the importance of corporate governance (“CG”) becomes more prominent and the compliance needs of global best practices, such as reporting, becomes crucial.
Reporting includes information about the organization and some of such information include (this may vary from jurisdiction to jurisdiction in terms of scope and depth):
- Identification of the organization’s CG philosophy
- Alignment of the CG philosophy with the organization’s objectives
- The organization’s ownership structure, subsidiaries, etc.
- Board of Directors information
- Committees information if any
- Board of Directors Meetings
- Annual General Assembly Meetings
- Conflicts of interest and related party transactions
Schema has identified an effective reporting process that facilitates the efficient collection and compilation of information in an accountable and transparent manner. Such information is then streamlined into a report that can be provided separately or inserted as part of the organization’s annual report.
Reporting on CG is now becoming a legal requirement in most jurisdictions in particular in financial sectors and with respect to listed companies. However, it is worth expending on reporting before it becomes compulsory in order to allow for internal capacity building and have the time to test various reporting methodologies before being required to make such reports public.
Further, reporting on CG is also an effective monitoring and evaluation tool to ensure that an organization is aligned with global best practices, constantly improving and attracts investments when necessary.
Reporting also addresses an organization’s disclosure requirement and may be a tool to engage stakeholders other than the shareholders.