As the complexity and pressures of global regulatory compliance continue to increase, the role of the corporate secretary in governance becomes ever more important. This is the person who must advise the board on matters of compliance and governance, and who must take a front seat to drive how the organization operates and ensure it does so according to regulatory guidelines, both locally and internationally.
The increasing importance of the corporate secretary to the modern board’s operations is leading to a growing number of governance leaders taking on the title of Chief Governance Officer – it’s a way to reflect their seat at the top table and to recognize the true nature of the essential work done by the corporate secretary.
This move toward the corporate secretary as Chief Governance Officer is such an important and well-recognized one that educational institutions now offer qualifications to be a Chief Governance Officer, and a quick search for the job title on LinkedIn reveals hundreds of people reporting themselves to be in the role of Chief Governance Officer (though hundreds of thousands still identify themselves as company or corporate secretaries).
Even without the official job title, though, the role of the corporate secretary today is increasingly moving toward being the chief staff member to guide and oversee the strategy behind the organization’s governance processes and codes of conduct.
The role of the corporate secretary
The role of the corporate secretary has evolved from the traditional role of a secretary, namely as the person who takes minutes, organizes meetings, maintains the corporate record and associated documentation, and generally performs administrative duties for an organization. And while, yes, the corporate secretary still takes on this mantle, the role has evolved in recent years to become a more advisory and senior position.
Today, the corporate secretary could take on those administrative duties alongside the following, according to the Governance Professionals of Canada:
- Implementing the decisions of the board of directors.
- Acting as adviser to company directors.
- Handling company share transactions, such as issuing new shares, arranging dividend payments and observing all legal requirements.
- Liaising with auditors, lawyers, tax advisers, bankers and shareholders on board governance issues.
- Ensuring that compliance obligations under relevant laws and the requirement of regulatory authorities, such as the stock exchange, are met and maintained.
To be able to fulfill these duties, the corporate secretary must have a thorough understanding of a company’s business, a working knowledge of corporate and securities law, a sense of balance no matter how pressured a situation is, and the ability to read signals and provide early warnings to management – all of which are far advanced from that traditional minute-taking and administrative role.
Taking a front seat in modern governance
Corporate governance is no longer a hands-off affair; once the global financial crisis hit at the end of the last decade, financial stability became the main concern of global regulators, and an era of unprecedented visibility requirements came into play. The corporate secretary must now ensure that the way the business is owned, structured and operating is in line with all manner of new regulations aimed at keeping global markets moving in the right direction, and slowing down the once-unfettered growth of globalization.
By taking on the role of Chief Governance Officer, the corporate secretary takes the next step in the evolution of governance reporting. It’s no longer about presenting facts and leaving it to the CEO to make a judgment; the corporate secretary as Chief Governance Officer must interpret reports and entity data, examine organizational charts and bring critical analysis to the boardroom.
Holding a unique position between the board, the management team and the shareholders, the corporate secretary as Chief Governance Officer must make sure all these voices come together in the boardroom and beyond. Acting as Chief Governance Officer, they must bring clarity, simplicity and transparency to the board agenda, communications and reporting. It’s the responsibility of the corporate secretary to ensure that regulatory changes and the complexity of strategy discussions are handled in a timely, efficient and transparent manner, and that all stakeholders are not only aware of what’s going on, but also that all filings and deadlines are met efficiently.
Leveraging technology to inform the role of Chief Governance Officer and modern governance practices
To maintain this role as Chief Governance Officer, the corporate secretary must have constant access to real-time entity data to enable their essential advisory work. Modern governance practices require the right information to get to the right people at the right time – if it doesn’t, directors and board members could not only risk the organization’s reputation, but their own livelihoods too, with personal sanctions becoming more common in the event of a failure of corporate governance.
The integrity of entity data is an essential part of the Chief Governance Officer’s remit; without it, the board will make decisions based on incomplete or erroneous information, leading to the wrong moves or missed opportunities, as well as the possibility of fines and even jail time in some jurisdictions.
That’s where technology can come into play to aid the Chief Governance Officer in their role as information guardian. By utilizing entity management software, for example, the corporate secretary as Chief Governance Officer can create a single source of truth, a central repository for all entity data, and organizational information from which to create reports and build analysis.
But it’s not just a matter of the entity data; technology can also help to ensure board operations run efficiently. A board portal provides modern governance tools that allow the board to expand their reach outside the boardroom, as well as driving meeting requirements, such as the distribution of board materials in a secure, cloud-based environment. Board members, stakeholders and the Chief Governance Officer can access and provide real-time updates from anywhere in the world from their phones, tablets, computers or even offline.
Diligent has a number of solutions to support the corporate secretary as Chief Governance Officer – from entity management software and board portals to a secure file-sharing platform – all of which integrate seamlessly to create the Governance Cloud, an all-in-one governance ecosystem that helps to streamline duties for compliance, regulation and governance while keeping all processes in a highly secure, confidential platform.
Get in touch and request a demo to see how Diligent’s Governance Cloud can help support the Chief Governance Officer with best-in-class modern governance practices.