With boards of directors under increased scrutiny by regulators and other entities, CIOs should consider creating a digital dashboard that gives them a view into the key performance indicators of the business
Want to dramatically raise your profile with your CEO, CFO and corporate counsel? Do high-impact professional risks intrigue you?
Then consider making an offer your company's board of directors may dare not refuse. Create a "digital dashboard" and database that puts all the information a nonexecutive director might need right at his fingertips: compensation levels, capital spending histories, changes in accounting rules and so on. Treat the board like a business unit. Support directors as if they were C-level peers. Turn them into valued customers and clients for your IT shop. Learn from them. And yes, give them tech support if they ask.
The reason is as obvious as, say, an Enron trial in Houston. Litigators and regulators are making directors ever more accountable for their actions and inactions. The future of global enterprise doesn't merely reside in better management or superior leadership; it's now contingent upon good governance. That's not an annoying business trend - it's a transcendent legal principle. Companies defy it at their peril. And the importance, liability and legal exposure of nonexecutive directors will be even greater five years hence.
Once upon a time, independent directors with sterling resumes could successfully plead ignorance if their board-approved mergers, acquisitions, hiring, firing or audits went awry. Today, they can still plead ignorance. However, they'll be doing so under oath before judges and juries legally empowered to interpret ignorance as negligence. Ignorance isn't bliss. There are good reasons why Directors' & Officers' insurance rates have skyrocketed.
Of course, nonexecutive directors are free to trust whatever data they get from the CEO, CFO and the auditors. However, if you were on a board that was increasingly being held to stricter standards of accountability, wouldn't you like to have your own information window into the enterprise? Wouldn't you like to show a court of law that you demonstrated fiduciary "due diligence" as a director by digging deeply into the data? Yes? Then "Hello, CIO!"
The harsh truth is that the law is herding directors into investing more time and effort into more serious governance. The simple fact is that you can't have good governance without good information.
The challenge is shockingly obvious: CIOs should be taking the lead in working with their CEOs, CFOs, corporate counsels and, yes, the auditors, in developing customized systems to support the board.
Might this put the CEO, CFO, corporate counsel and the auditors in an awkward position? Absolutely. Doing the right thing is always risky. Then again, not doing the right thing is even riskier.
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