This document discusses establishing the right corporate governance structure to address crises. It asks how a governance program can both prevent regulatory issues and promote a healthy culture, have independence and compliance power, and pool resources across an organization. Good governance can reduce crisis risks and enable better crisis responses by balancing compliance, performance, and growth. Emerging technologies may allow more strategic, predictive regulation by turning data into smart insights. Overall, strong governance through balanced oversight is key to running sustainable businesses less vulnerable to crises.

1. How to establish the right
governance oversight structure
to address corporate crises
David Doughty
Chartered Director, Chief Executive,
Chairman, Non-Executive Director
CEO Excellencia
The Corporate Governance experts
11th annual European GRC and IT
Security Summit

2. Questions
• Can a healthy governance program achieve the dual
goals of preventing regulatory process delinquency and
at the same time promote a healthy corporate
governance culture to respond to the current
governance demands of cyber-security or regulatory
issues?
• How can a global corporate governance program have
both independence to perform and grow, and power to
comply?
• How to pool resources with multiple governance
functions across the organisation and transactions.

3. Crisis, what crisis?
Crisis is a major event that threatens to harm
the organisation, its stakeholders or the general
public

5. ‘We also do cut‐glass sherry decanters complete
with six glasses on a silver‐plated tray that your
butler can serve you drinks on, all for £4.95. People
say,
"How can you sell this for such a low price?", I say,
"because it's total crap".’
He compounded this by also remarking that some
of the earrings were ‘cheaper than an M&S prawn
sandwich but probably wouldn't last as long.’
After the speech, the value of the Ratners' group
plummeted by some £500 million.
Gerald Ratner 1991

6. What do we mean by
Governance?
Chief
Executive
Senior
Management Team
Staff
Shareholders
Board
Chair
Accountable
to
Delegates
Direction &
Control to
Sets Objectives
for
Reports progress
to
StrategicOperational

7. It’s all a question of risk
• In the current climate, the biggest risk faced by
any organisation is reputational
• Yet how many boards still spend most of their
time focusing on financial risks?
• In Financial Services 2 biggest risks are KYC and
AML compliance – but what are the real risks?
• Being compliant does not mean you have
addressed all the strategic risks especially if
implementation creates a barrier for customers

8. Questions
Can a healthy governance program
• prevent regulatory process delinquency
• promote a healthy corporate governance culture
to respond to the current governance demands of
cyber security or regulatory issues?
Yes – good governance
• reduces the risk of a crisis
• enables the organisation to respond better to a
crisis

9. Equifax
• 146million US
records
• 14million UK
records of names
and date of birth
• 694,000 records of
telephone numbers
• Richard Smith
Chairman & CEO
resigned

10. Questions
• How can a global corporate governance
program have both independence to perform
and grow, and power to comply?
• Balance between
– performance & growth
– compliance

12. Volkswagen

13. VolksWagen
• 11million vehicles worldwide emitting 40x
Nitrous Oxide levels to when in test mode
• Up to 100 additional deaths in US
• Strategy intended to save $4.8bn worldwide
• Actual costs $18bn and rising
• Roots of the problem:
– Poor Corporate Governance
– Lack of diversity on supervisory board
– Culture (Vision, Mission, Values)

14. Questions
• How to pool resources with multiple
governance functions across the organisation
and transactions.
• Stop seeing compliance as a burden and look
upon it as a source of competitive advantage
• Use AI and big data analytics to predict issues
before they occur
• Work pro-actively with regulators

15. The future
• To date regulation has been tactical and
reactive
• Move to strategic and pro-active
• RegTech can use AI and big data analytics
predictively to detect criminal activity
• Focus on turning big data into smart data
• Emergence of compliance management as a
service

18. Sky Plc

19. Summary
• Good Corporate Governance is essential for
running a good business
• A well run business is much less likely to suffer a
crisis
• A well run business is much better at dealing with
a crisis
• Good Corporate Governance is about getting the
balance right between:
– Compliance with regulations
– Growing a sustainable business for the long-term

20. Thank you
david.doughty@excellencia.co.uk
www.linkedin.com/in/daviddoughty
www.facebook.com/DavidWDoughty
@daviddoughty