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Introduction

 

 

Between a fast-moving and flexible regulatory context, open to different interpretations, and the many beliefs deeply rooted in people’s minds, we cannot deny that governance is a subject which remains unclear and poorly identified, a fact which does not encourage a good use of it.

 

 

Votre-Administrateur offers you, within this space dedicated to regulatory matters (regulations, codes of governance, best practices, reference books and publications), enables you to find all the information you need to have a good understanding of the subject of governance.

“Comply or explain”

This has been the choice available in France concerning governance since European Directive 2006/46/CE was published, introducing at the same time the basis of a common European approach to the subject.  Beneath this choice, presented as a kind of motto, several important points should be remembered.

Governance, without being an exceptional subject, is nevertheless a complex one. The legislator has allowed a certain degree of free choice – the organization determines its own code of reference, rather than it being totally imposed – the organization adopts the existing code, although within a framework which is particularly vigilant and regulated. A freedom of action which must not be taken lightly, for whatever choice the organization makes, it must show itself to be exemplary in the means used to make its governance clear and transparent.

In addition, if this famous soft law appears attractive – witness the upsurge of codes of reference specific to the organizations concerned – we should not neglect the need for a controlled governance; in other words, one which can manage its requirements of mastery, challenge and support of a strategy. The flexibility of the method must not mask the fundamental rigour necessary to the development of an organization, as well as the undeniable obligation to report back regularly and reliably.

Thus, by giving organizations (company, association, foundation etc) the possibility of determining their own code of reference and framework of management, regulations offer them a challenge worthy of the stakes involved: to create the conditions of responsibility and sustainability which will carry their company projects.

Governance, peculiar to every organization

There is a widely held belief which suggests that governance is a subject restricted to large, and moreover listed, groups.  Not only is this belief totally false, it is also prejudicial to small structures which imagine that they are excluded.  Governance, the art of managing, concerns all kinds of organizations (company, association, foundation), in all possible forms (listed, unlisted, cooperative, patrimonial), and of all sizes (very small businesses, medium-sized companies, small and medium enterprises and large groups). And in the specific case of small structures – very small businesses, start-ups, where the strategic choices are all the more important because they will unquestionably determine their survival and permanence – governance becomes a fundamental element.

There is another belief which leads us to think that governance is reserved to large groups. Governance appears complicated, too expensive, and too time-consuming. If this perception of governance is extremely simplistic, it is even less true when each organization has corresponding and well-adapted governance. A large listed group will have a board with specific obligations, and which will not suit the needs of a foundation or a very small business. On the other hand, whatever its size or form, an organization is faced with the same questions – what is my strategy? How can I make sure that my actions are going in the right direction? How can I protect myself against risks? – which oblige it to set up a well-adapted and reliable governance.

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