I find this topic very exciting, more so that it is one of those activities in corporate governance that may be termed as “informal” or “initial”. They are the background discussions that inform certain actions taken by organizations.

Further to being accustomed to a structured framework for achieving milestones in governance, one is required to consider the informal activities that may be critical enablers to governance and decision making.

I have come across notions to the effect that those who think that decisions are made in the four corners of the Boardroom have a myopic understanding of the process. Further there is a notion that the reason some governors appear “lost” or behind on matters under discussion in a meeting, is that they were not on the golf course where the matter was extensively discussed, options weighed, and necessary support garnered. The feeling that your contribution seems ineffective because the decision seems premeditated, has potential for frustration.

At the level of a governing body, it is common for governors to liaise with one another on matters that are due for deliberation and caucus outside the formal meeting with a view to reaching consensus on issues and leveraging on the mix of skills and experience in their grouping as they proceed to exercise their independent judgement at the fora where a record of deliberations will bind them to collective responsibility.

If exercised properly, caucus adds to efficiency in that there is an opportunity to exchange notes and latent information that are required for quality decision making. However, if the caucus event is used to settle scores between personalities, it becomes a toxic environment and breeds confusion and polarization which do nothing for the promotion of the success of the organisation.

In some transactions, there is usually more than what meets the eye at stake and a need to appreciate the transaction from all possible angles including the visible and not so visible stakeholders, social economic and political impact, arises. Questions as to “who”, “what” and “what if” are topical and beg exhaustion prior to sealing the deal, so to speak.

Further, there are times when stakeholders feel that there is a need to communicate their views and objectives on certain matters to the managers of the organisation without violating the structures of governance. Engagement at different levels of management of an organisation is an acceptable notion in corporate governance on the understanding that the modus of such engagement does not amount to undue influence or violation of other regulatory requirements.

Another interesting notion in corporate governance is shareholder activism, which is a way that shareholders can influence a corporation’s behaviour by exercising their rights as partial owners. It is also an exciting area of corporate power play and a demonstration of the use of one’s stake in a company to further certain interests.

In closing, I propose that the actors in corporate governance take a keen interest in the activities discussed above and where they reside within the structures of governance. I am of the view that governors and implementers alike are better placed to understand such role playing in order that the risk of walking on thin ice on account of lack of consideration of the broader picture is avoided or mitigated. Governance is dynamic and should be embraced as such!

Thank you.