Grandstand. Orpea, Soitec, Atos, Danone, Renault: the examples of the sudden ousting of leaders by reinvigorated boards of directors cannot make us forget that the fires that we seek to extinguish often find their origin in complacency, negligence or the blindness of these same councils.
However, do not throw stones at them! Although legally responsible for determining the strategic orientations of the company and controlling the action of the management, the directors do not have the corresponding resources. The board of directors should be the keystone of governance. It is only an appendix.
All the means of action, information and control that would allow it to fully assume its functions – operating budget of the board, secretary of the board, internal audit, auditors, legal, financial or extra-financial experts, surveys internal on staff engagement, whistleblowers, etc. – escape him, because they depend more or less on the general management.
Rebalancing the powers
If we want more responsible companies and more controlled management, we must rebalance the powers of management and control by transferring to the board the functions of governance and the corresponding financial and human resources. It is up to each board to draw the outlines of these functions, according to what it deems necessary for the company, and to convince the shareholders of the relevance of its organizational choices. At the very least, the board must have access to independent information, that is to say information that is not produced solely by management, and it must strengthen its culture of control.
Many technical methods are possible to organize this transfer of skills. This can range from the simple delegation of powers to the creation of a subsidiary making it possible to give the board a real legal personality.
Whatever solution is chosen, the board must be transferred the budget and the personnel corresponding to the functions it has decided to recover. In any case, the secretary of the board must report to him in order to assist him in the implementation of these responsibilities.
The legitimacy of this transfer must be confirmed by the shareholders. These would decide at the annual general meeting on an ad hoc and consultative resolution of governance relating to the level of budget planned for the board, the organizational choices retained, the possible service agreement and the description of the activity of the board in the report on corporate governance. Shareholders could thus make an informed judgment on the quality of the governance system.
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