Biotech Company Situational Analysis
ghv1293
GovernanceOverview_Lecture_V1.pptxHarrisburg University ISEM 547
Governance Overview & Corporate Governance
Objectives
Components of Governance
What is Corporate Governance
Good Governance & Best Practices
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What is Governance?
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What is Governance ?
Governance incorporates all the guiding principles, codes of conduct, regulations, processes, procedures, and polices that coordinate and control an organization’s resources and actions
Governance frameworks often take the form of councils, boards, and committees that ensure accountability and compliance.
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Key components of Governance Framework
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Components of Governance Frameworks
Governing Bodies: these are entities established within the organization for the creation, execution, and management of governance (Boards, Committees, Councils, Workgroup);
Board: is a group of people who have the oversight, power, and authority to decide and control the workings of and organization. They are more strategic, set the direction, and can delegate its functions and authority to a committee.
Committees: are usually subgroups created and sanctioned by the board to carry out much of the detail work for specific purposes with formal charter and protocols. Committee members are usually assigned due to their expertise and/or have a vested interest.
Council: an official government body with the power to make and/or enforce laws to control a country, land area, people or organization. Note: legal council is often consulted regarding IT matters.
Workgroup: is a ad hoc group of subject-matter experts of individuals assembled to work together on a common goal or task. Often formed to work with committees on specific initiatives for a limited time period then disbanded when the task has been completed.
Organizations usually has a mix of business and IT related governing entities.
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Components of Governance Frameworks
Policy: are principles, rules, and protocols formulated or adopted by an organization to govern its actions.
Procedures are specific instructions to be used to implement policy requirements in a specific way; they are enforceable through the policy
Guidelines are general rules, practices, and/or instructions that can be referenced to comply with policy; they are not enforceable but recommended as best practices that should be followed
Policies should have a formal lifecycle and change management process
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Components of Governance Frameworks
Standards: refer to something that is considered by an authority or by general consent as a basis of comparison (e.g., industry, protocols, academic, etc.)
Metric: is a quantifiable measure that is used to track and assess the status of a specific process, system, or entity. Metrics can be used to determine status, effectiveness or compliance (e.g., governing bodies, policies, processes, procedures, systems, components, etc.)
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Components of Governance Frameworks
Enterprise Risk Management: Risk management is the identification, assessment, and prioritization of risks to minimize, monitor, and control the probability and/or impact of unfortunate events or to maximize the realization of opportunities.
Training: is an effective mechanism used for stakeholder awareness regarding governing bodies and policies are important to inform and educate stakeholders
Communications: define communication strategies and plans for stakeholders when instituting new or making changes to existing governance frameworks within the organization.
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IT Governance Frameworks
Governance Pro
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Good Governance
Governance Pro
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Characteristics of Good Governance
Good governance has eight major characteristics: participatory, consensus oriented, accountable, transparent, responsive, effective and efficient, equitable and inclusive, and follows the rule of law.
Rule of Law requires fair legal frameworks that are enforced by an impartial regulatory body, for the full protection of stakeholders.
Transparency means that information should be provided in easily understandable forms and media, freely available and directly accessible
Governance Pro
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Characteristics of Good Governance
Responsiveness requires that organizations and their processes are designed to serve the best interests of stakeholders within a reasonable timeframe
Consensus Oriented requires consultation to understand and best serve the different interests of all stakeholders affected by the policy.
Equity and Inclusiveness the organization that provides the opportunity and mechanisms for its stakeholders to improve their well-being
Effectiveness and Efficiency means that the processes implemented by the organization to produce favorable results and meet the needs of its stakeholders
Governance Pro
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Characteristics of Good Governance
Accountability is a key tenet of good governance. Who is accountable for what should be documented in policy statements.
Participation inclusion of both men and women, either directly or through legitimate representatives, is a key cornerstone of good governance.
Governance Pro
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Corporate Governance
MIT Sloan School Center for Information Systems Research (CISR)
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Senior Executive Team
Strategy
Desired Behaviors & Outcomes
Board of Directors
Governance Committees & Workgroups
Key Corporate Assets
Human Assets
Financial Assets
Physical Assets
Data/Information & IT Assets
Brand Reputation
Relationship Assets
IP Assets
Key Asset Governance
Legal & Regulatory
Shareholders
Other Stakeholders
Risk Management Policies & Procedures Audits & Compliance
Standards Organizations
IT Governance
What is Corporate Governance ?
Corporate governance is the system of rules, practices and processes by which a company is directed and controlled
Is a framework of values, rules, policies, and practices by which the Board of Directors (BOD) ensures accountability, fairness, and transparency in a company.
Corporate governance involves balancing the many interests of the stakeholders of a corporation and the protection of corporate assets
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What is Corporate Governance ?
Corporate Governance Framework
Corporate BOD via senior executive team authorizes the establishment and provides oversite of governing bodies that align with corporate strategy and drive desired behaviors and outcomes
Governance committees and workgroups are the workhorse of the corporate governance framework
IT Governance is a subset of Corporate Governance
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What is Corporate Governance ?
Corporate Governance Framework - Assets
Human Assets
Financial Assets
Physical Assets
Brand-Reputation Asset
IP Assets
Relationship
Data/Information & IT Assets
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Benefits of Corporate Governance
Legal compliance
Improves Company Reputation
Establishes oversight, transparency, accountability, and controls in place that are in best interest of the company
Shareholder Wealth Creation
Decrease conflicts and fraud
Fewer Fines, Penalties, & Lawsuits
Increase competitiveness and higher market valuation
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Benefits of Corporate Governance
What are the governing bodies associated with corporate governance?
Has anyone been a part of a corporate governing body (e.g., board, committee, workgroup)? Do you feel corporate policies are effective?
What was the purpose of the governing body and what decisions did they make?
What are the characteristics of good governance?
What assets are to be protected through corporate governance?
Where is IT Governance in relationship to corporate governance?
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Group Discussion Questions
Assignments
Chapter 8 (IT Managers Handbook)
Homework 3: Corporate & IT Governance Frameworks
Project 2:
Part A: Create an IT Governance Matrix
Part B: Create a Governance Charter for Enterprise Security Committee
Part C: Write a Information Security Policy for Data Classifications
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