The Governance Journey: How Much and When?

A question Fidelio is frequently asked in the course of our Board advisory assignments is “What is the appropriate level of governance, given the size of our company?”

  • What is the optimal Board size?
  • How do we think about independent Directors including the Chair?
  • What reporting structures and committees need to be in place?

The guidance and regulation of major quoted companies dominates the public debate on governance. Smaller companies have fewer resources to dedicate to the task and typically are also dealing with less complexity.

But governance is not a compliance manual. Good governance is effective leadership and oversight from the top; a well-run company – whatever its size – will have a good decision-making capability and framework and will be cognisant of its accountability to its shareholders and key stakeholders.

Thus, when Fidelio explores governance with fast-growing companies, for example in the FinTech sector, we find it beneficial to go back to basics. Why is governance needed?  What are we seeking to achieve? We also recognise the need for very practical guidance on how such a governance framework can be put in place.

This week’s Overture looks at the governance journey for companies on a growth trajectory – and growth is something we need to be holding onto in the current environment! We explore four key aspects of governance which typically need to be developed and strengthened in this instance in the transition from Series B to Series C funding:

  • Composition
  • Board Committees
  • Reporting
  • Regulation

Governance needs to be dynamic to be effective; while there is no one size fits all, good governance is about effective leadership, adding value and giving comfort to both shareholders and stakeholders. For the full Overture, please click here.

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