Alain Deniau held this presentation at the 2014 SME Assembly in Naples, Italy: "Dynamic Governance - Public Institutions & SME". Find out more at: http://blogs.ec.europa.eu/promotingenterprise/

1. DYNAMIC GOVERNANCE
Public Institutions & SME
Alain Deniau & Alexa Bailey October 2014

2. 1
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around the world, we have the resources and contacts
necessary to conduct a global, multinational, national, or
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Heidrick & Struggles
► We are keen to add value to world class businesses
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leadership advisory services, including executive
search, talent management, board composition,
executive on-boarding and M&A effectiveness
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with a Global team of over 350 consultants working
from more than 50 locations in principal cities of the
world and emerging markets
► Our clients include FTSE 350, Fortune 1000 and other
marquee global organizations. We successfully
completed over 550 CEO and Board engagements in
2013
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3. 2
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4. 3
How we foster and help to lead Board debate and development

5. 4
The Next Horizon for High Performing Companies
The European Corporate Governance Report 2014 sets out a new charter for the boardroom
based on:
- Detailed analysis of 400 of Europe’s largest listed companies conducted biennially since 1999
- A board effectiveness survey completed by 236 European board members
- Heidrick’s 60-year track record of working with high performing boards
The research identifies six key characteristics that define a new spirit of agile and responsive
governance rooted in board leadership:
1) Deep Business Knowledge
2) Diversity of Thought
3) Engaged Leadership
4) Strategic Alignment & Execution
5) Capacity to Adapt
6) Leadership Talent
When combined these lead to Dynamic Governance

6. “The best companies do not wait to
be governed, they shape the debate
and set best practice with agile and
responsive leadership that adapts
quickly to the changing circumstances
of business.”
Can Public Administrations
use our findings to increase
their efficiency?

7. DEEP BUSINESS KNOWLEDGE
Curiosity is a prerequisite – inspect don’t expect
Any debate is only as good as the quality of the information and knowledge at work. Chairmen and boards must possess deep insights into the business.

8. DIVERSITY OF THOUGHT
Diversity must be rooted in meritocracy and the attainment of business goals. The needs of the business drive diversity.
“The selection of the right people for the board is increasingly critical. Diversity of thought is the key.”

9. ENGAGED LEADERSHIP
The modern chairman requires an “all-court game”
The job of the chairman is to manage the balance of skills, knowledge and experience on the board, and to constructively challenge management and the non-executive directors to drive outstanding performance.
“If the CEO is the heart of the company pumping vibrancy through its very core, the chairman is the soul of the corporation, its conscience, its moral keeper.”

10. STRATEGIC ALIGNMENT & EXECUTION
Organizational nirvana occurs when everyone knows where they are going, the strategy for getting there and then makes that happen.
The theory is alluringly easy; practice, devilishly difficult.
“In the short, they (board members) cannot be uncritical lovers but have to be loving critics to the institutions which they are paid to serve.”

11. CAPACITY TO ADAPT
World class boards try to anticipate the next development – to future proof the company
One of the greatest challenges facing corporate governance is that it is seen and often interpreted and implemented inflexibly. This is out of kilter with organisational reality. In the face of continuous change and relentless competition the capacity to adapt is a key competency. Organisations - and boards - must be able and willing to change direction if and when required. Governance, at its best, is forward looking but fully aware of the lessons of past performance.

12. LEADERSHIP TALENT
People execute strategy
Identifying and developing leadership talent and planning succession issues among a company’s leaders is often on the to-do list of boards. There it can remain.
“In the long run, the systematic development of stars is the most effective strategy to create a sustainable competitive advantage.”

13. DYNAMIC GOVERNANCE Public Administration and SME
Good Governance can help the public administration to make SMEs grow through good legislation
Legislation may inhibit innovation
Compliance may not help business to develop
In the SME context, Capacity to adapt – Deep business knowledge – Diversity of thought are key factors for the Public Administration

14. DYNAMIC GOVERNANCE Applied to SME
Governance is the same for all entities and does not depend upon the size of the revenues or upon the fact that it is listed or not or family owned
The difference is in the way governance is implemented
The specific case of Family Businesses

15. 14
The family business dilemma in CEO succession
In all family business around the world,
whatever the country or the culture, a
major concern and critical challenge is
CEO succession. Most family
businesses, whatever their size, have
grown thanks to the exceptional
contribution of an emblematic founder.
This historical figure puts a constant
pressure on any one that follows in the
leader (CEO) role, especially as they
will have to accept, sometime
unfavorable, comparisons.
The four dimensions of a CEO role

16. CALL TO ACTION
Actions that should generate high-quality Public Administration which would lead to business competitiveness and economic growth
Define what is “good governance” for the Public Administration
How can the Public administration embrace all of our 6 key characteristic from the report?
What organisational innovation is required to ensure good governance?

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