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The Corporate Governance Framework™, designed by us, is used as a guide in providing support services and in developing our professional development programs.
The Framework is divided into quadrants, grouping elements of corporate governance according to their most relevant party: the individual director, the board, the organisation and the stakeholder. Each quadrant is subdivided into a number of slices representing the director practices essential to the quadrant's focus. The values in the outside ring encircle the practices of directors, boards, their organisations and interactions with stakeholders.
* The relative size of each segment does not indicate its importance to corporate governance as a whole.
This quadrant reflects the practices every director enacts as an individual in his or her director role – for example, the responsibilities he or she has in relation to leadership both as a director and as a chairman.
The second quadrant reflects the practices and competencies of individual directors in relation to the whole board – their commitment to the successful functioning of the board and collegiate responsibilities.
This quadrant focuses on the responsibilities of directors in relation to the performance of the organisation, including those of senior executives. There is a focus on relationships and critical areas of organisational functioning that should be led by directors as individuals within the whole board.
This section of the Framework identifies the director-level operations that underpin peak organisational performance, including compliance, risk, strategy, finance and management relations.
This quadrant focuses on the essential interaction between directors and stakeholders. This encompasses the outward focus directors need to take into account in carrying out directorship responsibilities. It includes director responsibilities to stakeholders beyond shareholders, to the local community and society at large.
Applying the Corporate Governance Framework
The Framework provides the basis for a common language regarding director practices. With increased use over time, and broad take-up, it has the capability to improve communications about governance and director matters within, and between, a range of stakeholder groups.
The AICD uses the Framework to guide the development of support services and products. For example, our Self-assessment Tool and our collection of Director Tools.
Some ideas for how the Framework can be applied by governance leaders include:
- Assisting directors with planning their future professional development by making use of the confidential Self-assessment Tool.
- Examining the AICD's professional development offerings in accordance with the Framework quadrants, to more easily select the most suitable activities for your needs. With the myriad practices of directorship laid out, it is easier to review personal knowledge, attributes and skills, and identify areas for improvement.
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