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The Company Secretary: Building Trust Through Governance - Coggle Diagram
The Company Secretary: Building Trust Through Governance
'Conscience of the company'
In fulfilling the role as governance professional, the company secretary is often called on to advise the board what the right thing to is to do in the long term interests of the organisation
Often goes beyond what the law and regulations require and so takes the company secretary into the realm of what is known as business ehtics
As the governance profession, the company secretary should also speak out against bad governance and unethical or illegal practices such as if a proposal from management requires the company to pay a bribe to a government official
The company secretary must be independent minded and also not be under the influence of either senior management, the chair or another individual director
Many CS found that their role was misunderstood and that many of their duties were considered administrative in nature
The importance of CS contributed to effective governance and decision making within the organisation was not appreciated
The role of the SC is much more than just administrative. It delivers strategic leadership, acting as a vital bridge between the executive management and the board and facilitating the delivery of organisational objectives
CS are ideally placed to align the interests of different parties around a boardroom table, facilitate dialogue, gather and assimilate relevant information and enable effective decision making. They are often the only people to know first hand how the decisions made have been reacehed
The skills and attributes of the best CS are closest to those of the chairman: humanity, humility, high intelligence, understanding of agendas, negotiation and resilience
It is vital that CS have both director and informal access to board members, executives and NEDs, CEOs and Chairs
Maximising effectiveness requires that the CS direct reporting line should be to the chair and there should party of esteem and good team working between the triumvirate at the top, the chairman, CS and CEO
The role is changing, it is increasingly outward focused (incorporating investor engagement and corproate communications) and not just about internal administration
ICSA qualified CS deliver a more rounded governance and board member service than those who have come to the role via other professional routes
There is a conflict of interest in the combined head of legal and CS role, the roles should be separate as they can be incompatible
Board members often have a lack of awareness of the ways in which the CS supports an organisation in its decision making. Boards may miss out making use of the skills, knowledge and experience at their disposal
CS are often the longest serving members present at board meetings and so are a vital repository of company history and history and a guarantor of contintuty
CS are embedded in the process of making boards more effective, they contribute by observing boards in action and advising on any skill gaps that need filling
The breadth of CS role include additional responsibilities such as being an officer of the company, chief of staff to the chairman and adviser to the board on governance. Consequently the secretariat needs to retain independence to rebalance power as required and demonstrated accountability
Qualifications and skills
CA2006
Be a person who appears to them to have requisite knowledge and experience to discharge the functions of the secretary
Have been a secretary of a public company for at lest three years of the five years immediately preceding his or her appointment
Is a member of th Institute of Chartered Accountants in England and Wales
Is a member of the Institute of Chartered Accountants in Scotland
Is a member of the Association of Chartered Certified Accountants
Is a member of the Institute of Chartered Accountants in Ireland
Is a member of the Institute of Chartered Secretaries and Administrators
Is a member of the Insitutie of Charted Mnaagement Accoutnants
Is a member of the Chartered Insitutite of Public Finance and Accountancy
Is a qualified barrister or solciitor
Interperosnal skills
Empathy and relationship management
Respectful, diplomatic and effective communication
active listening
Bringing issues to the surface, especially those relating to reputational risk
Personal and social awareness
Being able to summarise common concerns and interests
Generating alterative solutions
Respecting confidences
Independent mindset
Strength of personality
Appreciating the views of all parties
Effective team working
Disagreeing constructively
Emphasising commercially minded approaches
Integrity
Practical skills
Listen actively: demonstrate attention and interest by nodding or using facial expressions. Try not to interrupt a speaker unless the speaker is dominating or going off topic
Establish rapport: Encourage speaks to reveal their concerns of interests: use open ended questions that begin with works like Who, what, why, how?
Be aware of body language, watch for signs of tension
Focus on constructive ideas: build on and contribute constructive alternatives. Avoiding using the word 'but' too often
Stay calm, be polite and avoid using heightened language or tone of voice that adds to or provokes anger
Avoid misunderstandings: paraphrase statements to ensure understanding
allow others to save ace: reframe statements in less confrontational terms to unlock disputes
Know when to close a confrontational exchange
Stay neutral, be ready to provide additional information if it helps. Avoid becoming arguementative
Suggest steps to resolve situations
Commercial and business acumen
To be commercially aware, an individual must understand the business they are in and make good practical decisions as a result
This means being able to advise the board on this basis so that they can make decisisons
Understand how your company makes money and creates value
Understand what your company needs, now and in the future so that it continues to make money and create value
Have a thorough understanding of your organisations competitive advanatage
Keep up to date with your industry
Many CS come into their role from diverse backgrounds often as second or third career
Need a diverse set of skills and experience that they can bring to the role
Often held senior positions in organisations and so understand the issues and forces that infeucne decision making
Key challenges faced by many CS
Being considered traitors by the executive team
Supporting chairs exhibiting poor performance
Acting as the third person in a CEO-chair relationship
Becoming a pivotal contact for insurmountable problems
Maintaining independence from other executives and board members