Recently, I took time to indulge the football lovers in our home by watching the game with them and joining their gasps, sighs and celebrations. I found myself asking a lot of questions about how the league works, who makes the money and who keeps it and so on. I learned that football is a very widely played game with a complex set of rules for the players, administrators and owners, among other stakeholders. There are high stakes in the game. Exciting!
Unbeknownst to my “teachers” I was inspired to write this article and use my experience with them to explain certain principles and practices of corporate governance. Who is the Owner, fan, cheerleader and athlete look alike in the corporate governance arena? I have attempted to break this down to the following digestible parts as I always do.
Owners – These are the shareowners of the organization as they have invested in the outfit with a view of getting a return. Like the owners of the football clubs, whose interest is to see a high return on their investment in the clubs through high performance of the team which would increase its fan base for viewership revenue, assignment of media rights for the games, endorsements from big brands, transfer of players and so on, the shareowners of the organization have similar expectations about their investment in the corporate.
Fans – This is the customer/client base for the organization which is a critical factor of any business. Without customers, there will be no uptake of the goods and services offered by the organization. Similarly, fans require to be enticed to keep loyal to supporting the team so that it can be motivated to win matches. The attachment between the fans and the team and vice versa can be an emotional affair at times and that is what keeps them engaged. During the FIFA World Cup, I was surprised to learn that there was a television channel dedicated to footage of how fans were responding to the matches as they watched and there were some amazing shots! That’s how serious this is. In governance, we employ different methods to retain and grow our customer base so that we can win their support over competition.
Cheerleaders – Arguably, cheerleaders seem to have a more pronounced role than the ordinary fans in the sense that they are engaged to motivate the teams in a specific and coordinated way. In my humble view, I think that Boards of governors do play a cheerleading role towards Management by providing them the necessary guidance and support to enable it to implement the strategic plan of the organization. I am of the view that without cheerleading, Management may feel unprotected and unsupported in their endeavor to move the organization to greater heights.
Athletes – The look alike here is Management which is associated with ensuring that the legwork is done. I think you have heard your Board say, “We have granted you the approval you sought and we now look forward to Management running with it”. Yes, because Management are the athletes! They are the ones that put the balls behind the net so that there can be celebration from the top of the food chain to everywhere else!
In earlier articles, I have alluded to the need for respective roles of actors in corporate governance to be respected and above all, performed effectively. I repeat that sentiment and submit that practicing this principle is the key to progressive action in an organization.
Which look alike are you?
Thank you.
