“An Alternate Universe: The Small, Young Company Board” from Deloitte explains why and how small, less mature companies should consider corporate governance practices geared toward their unique challenges and circumstances notwithstanding a potential variation or departure from so-called “best practices” that often center around larger, more established companies.
Areas of potential divergence from larger company “best practices” include board composition (e.g., director independence, industry knowledge, and skill sets); board oversight, which may entail a higher level of active engagement, and even management, at smaller, less mature companies than is typically the case at larger companies; and the use of outsourcing, co-sourcing, advisory boards, and other means to supplement the board’s abilities and capacities.
Notably, as is the case with larger companies, one-size-fits-one as respects the most effective governance practices for smaller, earlier stage companies.
Access additional resources on our Small Companies and Board/Governance Practices pages.
This post first appeared in the weekly Society Alert!