Since the global financial crisis, there has been an increasing interest in the role of the board, and decisions over risk management and operational decisions made by executives. The topic of corporate governance is becoming increasingly important in business research. However, corporate governance structure can be challenging.

Many boards of directors still struggle with questions in relation to their responsibilities. These include

• what is the role of the board and how does it differ from the role of management;
• where should the board be spending the majority of its time;
• how to position the board as a strategic partner with management, with compliance and laws a starting point;
• what to do in critical areas of oversight such as strategy and risk; and
• how does the work of committees relate to and differ from the work of the board.

Furthermore, each organisation and business is unique and requires different corporate governance structures. Boards are under intense scrutiny, and board members and executives are experiencing frustration as they work out how they can execute their fiduciary responsibilities while still ensuring the organisation is moving forward. There is a risk of boards suffering from “analysis paralysis.”

This report introduces the Deloitte governance framework. The framework aims to act as a tool for boards and executives to identify potential opportunities to improve both effectiveness and efficiency.

The top half of the framework highlights the area of the governance system where the board should take higher responsibility. These key areas include:

• Governance: The board establishes structure and board responsibilities
• Strategy: the board advises management in strategy and also actively monitor strategic plans
• Performance: The board reviews and approves company strategy, annual operating plans and financial plans
• Integrity: The board sets the ethical standards throughout the organisation and ensure compliance is met
• Talent:  The board selects, evaluate and compensates the CEO and oversees the talent programs of the company.
• Risk governance: The board monitors the company’s strategic, operational, financial and compliance

At the centre of the structure are risk and culture.  This means that boards should always be mindful of risks because risk management is linked to organisational culture.

At the bottom of the framework are elements of the board to ensure that there is proper monitoring. These four elements are planning, operations, reporting (both internal and external), compliance and risk management.

The Deloitte governance framework aims to help the board follow regulation easier, deal with scrutiny and create and assess critical processes and activities. Organisations are invited to use the framework and tailor it in the best way that feels right for their organisation.

1. Corporate governance is crucial to push organisations towards more sustainable business models.
2. The Deloitte governance framework encourages board members to revise their structure and increase responsibilities within the board to be more aware of risks.
3. This framework can lead to boards to be more aware of environmental and social risks that can impact their reputation and ultimately lead to an increase in corporate social responsibility.
4. Boards have the potential to be the instigators that lead to more sustainable finance.