On the board’s agenda
Governance in a multidimensional environment
For decades, organizations established subsidiaries to expand their operations, move into new markets, or protect themselves against risk. However, often times, companies pay little attention to their subsidiary governance practices that not only impact governance polices at the parent organization, but at their subsidiaries as well.
Subsidiaries: Governance is a multidimensional environment
Welcome to the latest issue of On the board’s agenda, a publication series focused on topical issues of importance to non-executive directors. Each issue examines a single topic in detail, and includes the perspectives of a Deloitte professional with deep expertise in the subject matter as well as the views of a non-executive director or external advisor.
In this issue…
Olivia Kirtley, a non-executive director of U.S. Bancorp, Papa John’s International, and ResCare, Inc., and president of the International Federation of Accountants and Dan Konigsburg, Managing Director, Global Center for Corporate Governance, Deloitte Touche Tohmatsu Limited, examine the multidimensional environment of subsidiary governance and highlight leading practices organizations are taking to better align the governance of parents and their subsidiaries. Select practices include:
- Assigning a senior executive to be directly responsible for managing the organization’s subsidiaries, overseeing their governance practices, and ensuring they’re aligned with the parent’s requirements so the organization can better manage the risk exposures in its extended ecosystem
- Holding joint meetings or having common directors to assist with building transparent and accountable relationships between parent boards and subsidiary boards
- Balancing risk oversight and internal control processes between the parent and subsidiary organizations that could strengthen the entire organization from a risk oversight and mitigation perspective.
Learn how organizations can strengthen their subsidiary governance in this issue of On the board’s agenda.