The role of the board of directors in ensuring a culture of integrity

Corporate scandals are as old as the corporate form itself. Consider, for example, the controversies surrounding the role of one of the first modern corporations, the British East India Company, in the Bengal famine of 1770 and in the Chinese opium trade. Yet it is the increasing scale and scope of unethical acts carried out by individuals in the name, and interests, of corporations that continue to be concerning. Recent revelations surrounding the extent of bribery and covert surveillance used by News Corporation journalists in its British operations continue to shock the world and undermine confidence in that organiszation and journalists in general. Yet despite the systemic nature of many of these unethical activities, corporate leaders generally plead ignorance when transgressions come to light. During the enquity into the News Corporation scandal, Rupert Murdoch, the CEO and chairman, rejected the assertion that he was ultimately 'responsible for this whole fiasco' (House of Commons, 2011, Q.230). Instead, like many corporate leaders before him, Murdoch placed blame on the employees within the newspaper. His responses poses an increasingly important question: Do corporate leaders bear responsibility for the conduct of individuals within a corporation and, if so, why?

Reflections on talk about natural disasters by early childhood educators and directors

Facilitated discussion with early childhood staff working with children and families affected by natural disasters in Queensland, Australia, raises issues regarding educational communication in emergencies. This paper reports on these discussions as ‘reflections on talk’. It examines discrepancies between the literature and staff talk, gaps in the literature, and the inaccessible style of some literature-demanded collaborative debate and information re-interpretation. Reframing of the discourse style was used to support staff de-briefing, mutual encouragement, and sharing of insights on promoting resilience in children and families. Formal investigation is required regarding effective emergency-situation talk between staff, as well as with children and families.

An exploratory study into director selection : who do directors want on their boards and how do they select them?

This exploratory study into director selection involved in-depth interviews with Australian non-executive directors to identify what directors consider as important criteria when selecting new members and the approach taken to identify and select candidates. The findings indicate boards select new members based not only on their ability to contribute complementary skills and experience but also on a perceived compatibility with incumbent board members. While these two selection criteria are considered equal in importance, not all selection approaches are able to adequately assess both criteria. As a result many selections fail to realise their selection criteria.

Directing experience : an exploration of active analysis and visual cognition theory in the training of contemporary directors

The focus of this research is the creation of a stage-directing training manual on the researcher's site at the National Institute of Dramatic Art. The directing procedures build on the work of Stanislavski's Active Analysis and findings from present-day visual cognition studies. Action research methodology and evidence-based data collection are employed to improve the efficacy of both the directing procedures and the pedagogical manual. The manual serves as a supplement to director training and a toolkit for the more experienced practitioner. The manual and research findings provide a unique and innovative contribution to the field of theatre directing.

Who selects the 'right' directors? An examination of the association between board selection, gender diversity and outcomes

Using a sample of companies from the top 500 listed firms in Australia, we investigate whether the presence of a designated nomination committee and female representation on the nomination committee affect board gender diversity. We also examine whether gender diversity on the board affects firm risk and financial performance. We find that board gender diversity is significantly and positively associated with the presence of a designated nomination committee and that female representation on the nomination committee is a significant explanatory factor of increasing board gender diversity following the release of the 2010 Australian Securities Exchange Corporate Governance Council (ASXCGC) recommendations. Further, our results support the business case for board gender diversity as we find greater gender diversity moderates excessive firm risk which in turn improves firms’ financial performance. Our results are robust after correcting for selection bias and controlling for other board, firm and industry characteristics.

Micropolitical insights into Assistant Regional Directors’ leadership in Queensland Education

The position of Assistant Regional Directors, School Performance (ARD-SP) was established by the Department of Education and Training (DET), the government provider of public education in Queensland, in 2010, to improve student learning across Queensland by providing close supervision of principals. Based on interviews with 18 ARDs-SP and two of their immediate supervisors, this paper explores their views about this relatively new position and their understandings of the role. Following Blase and Anderson (1995), it uses micropolitical leadership theory to analyse comments made by the participants. A key finding was a view of leadership based on a differentiated supervision model whereby ARDs-SP worked with principals to ensure they met the corporate agenda. Participants’ comments favoured a leadership approach that was both adversarial (drawing upon power over and power through) and facilitative (drawing upon power through and power over) and for those principals deemed under-performing, an authoritarian leadership approach was apparent.

An observational analysis of the impact of board dynamics and directors’ participation on perceived board effectiveness

This study addresses calls for closer examination of board dynamics by offering an inside view of director interactions. Video-observations of three board meetings at each of two Australian corporations matched with director interviews and secondary data reveal distinct patterns of director interactions, their sources of variation and impact on perceived board effectiveness. Our data reveal that director interactions are multi-dimensional and dynamic: while group interactions across agenda items are similar, with a few directors leading the discussion, the contributing directors change across items. Moreover, directors’ inclusiveness and evenness of participation are associated with higher perceptions of board effectiveness. Last, we find that director interactions change with the nature of the items, board climate and board meeting arrangements. The study contributes to the literature by moving beyond the individual-level analysis of directors’ skills or independence, and offering a detailed view of how the joint group and individual dimensions of board dynamics affect board functioning.

A little learning is a dangerous thing: Factors influencing the increased identification of special educational needs from the perspective of education policymakers and school practitioners

This article considers the increased identification of special educational needs in Australia’s largest education system from the perspectives of senior public servants, regional directors, principals, school counsellors, classroom teachers, support class teachers, learning support teachers and teaching assistants (n = 30). While their perceptions of an increase generally align with the story told by official statistics, participants’ narratives reveal that school-based identification of special educational needs is neither art nor science. This research finds that rather than an objective indication of the number and nature of children with SEN, official statistics may be more appropriately viewed as a product of funding eligibility and the assumptions of the adults who teach, refer and assess children who experience difficulties in school and with learning.

Enterprise business technology governance: A validation of three technology-governance competencies for boards of directors

The competent leadership and governance of digital transformation needs to involve the board of directors. The reported lack of such capability in boards is becoming a pressing issue. Underpinning leadership in such transformation are the competencies to effectively govern Enterprise Technology (ETG). In this paper we take the position that ETG competencies are essential in boards because competent enterprise business technology governance has been shown to contribute to increased revenue, profit, and returns. We report the industry validation processes of a set of three board-of-director competencies needed for effective ETG related to strategy and planning; investment and risk; and, innovation and value creation. We conclude that gaps in board ETG competence remain.

Enterprise technology governance: New information and technology core competencies for boards of directors

Boards of directors have legal and ethical responsibilities to be competent. Yet, in a world where business models and whole sectors are being disrupted by rapid information and technology change, a majority of directors lack IT governance knowledge and skills. Individual IT competency and collective board Enterprise Technology Governance capability is a global problem. Without capability, boards are potentially flying blind, and risk is increased and opportunities to lead and govern digital transformation lost. To address this capability gap, this research provides the first multi-industry validated Enterprise Technology Governance competency set for use in board evaluation, recruitment and professional development.

Directors and officers insurance – Recent critical issues in Australia and New Zealand

Directors and Officers Liability Insurance (“D&O insurance”) has grown and evolved rapidly over the past 80 years to assume an important position in most corporations’ corporate governance and risk management strategies. This article focuses upon certain topical matters of particular concern to directors and officers including the availability of defence costs where a D&O policy is subject to a statutory charge; the commercial desirability of stand-alone “A-side” coverage, being the cover provided directly to directors and officers for loss resulting from claims made against them for wrongful acts; the impact of fraud and/or dishonesty upon D&O cover; and disclosure of the nature and extent of D&O cover to the directors and officers themselves and to third parties – in the latter case such access frequently being necessary to determine the economic viability of pursuing a proposed action against a company and its directors and officers.

Governance of enterprise Information and Technology: A new core competency for boards of directors

With the level of digital disruption that is affecting businesses around the globe, you might expect high levels of Governance of Enterprise Information and Technology (GEIT) capability within boards. Boards and their senior executives know technology is important. More than 90% of boards and senior executives currently identify technology as essential to their current businesses, and to their organization’s future. But as few as 16% have sufficient GEIT capability. Global Centre for Digital Business Transformation’s recent research contains strong indicators of the need for change. Despite board awareness of both the likelihood and impact of digital disruption, things digital are still not viewed as a board-level matter in 45% of companies. And, it’s not just the board. The lack of board attention to technology can be mirrored at senior executive level as well. When asked about their organization’s attitude towards digital disruption, 43% of executives said their business either did not recognise it as a priority or was not responding appropriately. A further 32% were taking a “follower” approach, a potentially risky move as we will explain. Given all the evidence that boards know information and technology (I&T***) is vital, that they understand the inevitably, impact and speed of digital change and disruption, why are so many boards dragging their heels? Ignoring I&T disruption and refusing to build capability at board level is nothing short of negligence. Too many boards risk flying blind without GEIT capability [2]. To help build decision quality and I&T governance capability, this research: • Confirms a pressing need to build individual competency and cumulative, across-board capability in governing I&T • Identifies six factors that have rapidly increased the need, risk and urgency • Finds that boards may risk not meeting their duty of care responsibilities when it comes to I&T oversight • Highlights barriers to building capability details three GEIT competencies that boards and executives can use for evaluation, selection, recruitment and professional development.

Leading Digital Transformation: Building Technology and Information Governance Capability in Boards of Directors and the C-Suite

Information and technology and its use in organisation transformation presents unprecedented opportunities and risks. Increasingly, the Governance of Enterprise Information and Technology (GEIT) competency in the board room and executive is needed. Whether your organization is small or large, public, private or not for profit or whether your industry is not considered high-tech, IT is impacting your sector – no exceptions. But there is a skill shortage in boards: GEIT capability is concerningly low. This capability is urgently needed across the board, including those directors who come from finance, legal, marketing, operations and HR backgrounds. Digital disruption also affects all occupations. Putting in place a vision will help ensure emergency responses will meet technology-related duty of care responsibilities. When GEIT-related forward thinking and planning is carried out at the same time that you put your business strategy and plan in place, your organization has a significantly increased chance of not only surviving, but thriving into the future. Those organizations that don’t build GEIT capability risk joining the growing list of once-leading firms left behind in the digital ‘cloud of smoke’. Those organizations that do will be better placed to reap the benefits and hedge against the risks of a digital world. This chapter provides actionable, research-based considerations and processes for boards to use, to build awareness, knowledge and skills in governing technology-related organization strategy, risk and value creation.