Enhance Organizational Performance
Corporate governance also serves to enhance organizational performance. It does so by establishing and maintaining a corporate culture that motivates directors, managers and entrepreneurs to maximize operational and project-based efficiency thereby ensuring returns on investment and long term productivity growth. To that end boards also may include additional committees. These are topics like research, ethics, and portfolio. Other high-priority themes such as strategic projects, special events and programs may be included in board-level committees, but generally are delegated to the organization under the guidance of the CEO.
Currently there is no evidence of a universal set of corporate governance principles applicable to all countries and their organizations. However, corporate governance guidelines produced by OECD encourage the application of good corporate governance. This is as a precondition for international loans to governments for financial sector and other structural reforms as well as equity investment and bank loans to large companies. Although the pressure is currently on listed companies to make transparent their corporate governance principles, this requirement is likely to be extended. And that is not only to all listed companies, but also to other privately and publicly owned companies and organizations that want to use money from others.
Although there is a need to increase the overseeing of governance structures this is not an easy task. As mentioned by James Wolfensohn, former president of Word Bank:
"… a number of high profile failures in 2001-2002 have brought a renewed focus on corporate governance, bringing the topic to a broader audience. ... the basic principles are the same everywhere: fairness, transparency, accountability, and responsibility.
These are minimum standards that provide legitimacy in the corporation, reduce vulnerability to financial crisis, and broaden and deepen access to capital. However, applying these standards across a wide variety of legal, economic, and social systems is not easy. Capacity is often weak, vested interests prevail, and incentives are uncertain".
The high visibility heaped on corporate governance sparked by the scandals at the beginning of the 21st Century, brought attention to a lack of governance policies in more specific disciplines. In the early 1990s, information technology executives perceived a crying need to put order into the then chaotic industry. Various programs and standards were developed, such that IT governance has become a solid cornerstone of the profession.
After the turn of the century, a similar need became evident in the burgeoning field of project management. Thus, the evolution of project management has grown from the management of single projects to multiple projects; to the development of project management offices; corporate project management offices; and chief project officers. To gather all this under one governing roof, enterprise project governance is making the scene.