Governance Is About Better Decisions - Not More Meetings
The misconception
Governance has an unfair reputation. Many see it as another layer of approval, another meeting, or another process that slows decisions and diverts resources from outcomes.
Governance can also be equated to simply compliance. A legal checklist rather than a tool for confident decision-making.
My view is somewhat different.
Governance, when designed well, empowers Boards and Executives to make better decisions by understanding risks, evaluating trade-offs and using the best information available at the time.
It isn't about slowing decisions down. Quite the opposite, it's about enabling decisions to be made efficiently and effectively.
Decision-making should be more efficient because accountability is clearer, risks are better known, and the associated benefits or outcomes sought by any governance requirements are best protected. The best governance is well informed, transparent and capable of inspiring stakeholder confidence.
There is often a perception that better governance means more governance, another committee, another approval, another policy or another report. Good governance is about ensuring the right people consider the right information in the right forum. It should not exist to say "no". It should enable organisations to pursue opportunities confidently while understanding the risks and trade-offs.
The quality of the decision and the quality of the outcome are not the same.
The reality of governance
Governance, like any other asset, is an investment. The return on that investment is often better decisions, fewer surprises and better alignment with organisational objectives.
One organisation whose decision-making principles have been widely discussed is Amazon. While every organisation is different, several of its principles reinforce the characteristics of effective governance:
- • Evidence before opinion
- • Informed participants
- • Focused decision forums
- • Independent challenge
Does this format always lead to the right outcome?
Probably not.
But it gives the Board the best chance to make a good decision. Outcomes can of course vary due to environmental, or outside influences (anyone remember COVID-19?), but the process to make an informed decision remains robust, repeatable, timely, and transparent.
Good governance
My philosophy has always been simple: ensure the right people have the right information, in the right forum, to make the best possible decision, transparently.
Transparency isn't just about communicating decisions. It's about helping stakeholders understand the rigour behind how and why they were made. If stakeholders cannot trust the process, the decision itself loses credibility.
This relationship between governance rigour and decision velocity can be visualised through the DNA Decision Landscape. It isn't designed to label organisations. Rather, it provides a simple way to discuss how governance influences the speed and quality of organisational decision-making, and where opportunities for improvement may exist.
The DNA Decision Landscape illustrates the relationship between governance rigour and decision velocity.
Organisations with low governance rigour often find themselves operating in either the Wild West, where decisions are made quickly but inconsistently, or the Void, where decisions lack both structure and momentum. At the opposite extreme lies the Bureaucracy Trap, where governance becomes increasingly rigorous, but decision-making slows. The objective is the Round Table, where governance rigour enables informed, collaborative and timely decisions through a clear understanding of risks, opportunities and trade-offs.
The DNA Decision Landscape in practice
Consider two organisations:
Organisation A
Every major decision follows the same process:
- • Decision papers prepared in advance
- • Appropriate stakeholders engaged early
- • Evidence-based challenge and discussion
- • Clear recommendation and documented rationale
- • Decision reached at a single meeting
Organisation A demonstrates many of the characteristics of the Round Table. Decisions are made through a consistent, transparent and rigorous process, with a confident decision made at a well-prepared meeting.
Organisation B
Every significant decision follows a different path and is often characterised by:
- • Inconsistent decision forums
- • Variable or missing documentation
- • Ad-hoc consultation
- • Unclear ownership
- • Fragmented decision pathways
Twelve months later, the Boards of both organisations ask the same question: "Why was that decision made?"
For Organisation A, the answer is straightforward. The Board can review the decision paper, the supporting evidence, the challenge that took place and the documented rationale behind the decision in a single place.
For Organisation B, the answer is far less certain. The rationale may rely on individual recollection rather than documented evidence, making it difficult to understand what decision was made, why, and by whom.
Which organisation would inspire greater confidence and trust as a stakeholder? More importantly, where does your own organisation sit on the DNA Decision Landscape?
Good governance requires courage
Some argue that decisions should simply rest with the individual closest to the issue, risk, or opportunity. Proximity provides valuable insight, but good governance strengthens those decisions through transparent challenge, robust discussion and clear documentation.
Good governance isn't simply about making today's decision. It's about creating a decision-making system that becomes stronger over time. Every significant decision should leave the organisation better equipped to make the next one. Good governance cannot guarantee good outcomes, but it maximises the likelihood of making the best possible decision with the information available at the time.
That also requires courage. One reason Amazon asks senior leaders to speak last is to ensure every participant has an opportunity to contribute before hierarchy influences discussion. If attendees deserve a seat at the table, they deserve to be heard. Organisations reach the Round Table not because everyone agrees, but because every perspective has the opportunity to be heard before a decision is made.
A challenge I once received during an engagement was “Is unanimous agreement always a sign of good governance?”
At first glance, yes. However, if unanimous agreement becomes the norm rather than the exception, I would question whether sufficient challenge is taking place. The committee meetings I remember most weren't the quickest. They were the ones where two well-supported viewpoints were respectfully debated. Good governance requires exploration of alternative viewpoints before decisions are made.
Accountability matters
If an organisation needs 14 committees, 200 policies and six layers of approval to make a decision, it doesn't necessarily have strong governance, it may have inadvertently drifted into the Bureaucracy Trap.
When accountability becomes diluted across too many forums, it becomes harder to understand where decisions were made, why they were made and who owns them. Clear accountability gives people confidence to stand behind their decisions which becomes extremely powerful.
Measuring effectiveness
When you look at governance and decision-making, the immediate thought may be to judge governance by outcomes. However, this method is like looking at the final score before looking at the team selection, tactics, possession and shots on target. A team can prepare perfectly and still lose. The question is whether following the same process would produce good decisions more often than not.
Let’s apply the converse concept to a Board decision:
Imagine the Board decides to acquire another company, and the acquisition turns out brilliantly. Financially it proved to be the right decision. However, there was no:
- • Due diligence
- • Conflict of interest declaration
- • Board paper
- • Legal review
- • Documented rationale
Is this an example of good governance?
No.
Governance is about confidence in how decisions are reached, not just their outcomes. In other words, organisations operating at the Round Table can stand behind the quality of their decision-making process, not simply whether every decision proves successful.
Conclusion
Governance isn't about certainty. It's about the confidence it gives organisations to make decisions when certainty doesn't exist.
When governance is working effectively, it strengthens:
- • The decision-making process
- • The quality of presented information
- • Understanding of risk, uncertainy and opportunities
- • Consideration of trade-offs
- • Transparency
- • Accountability
- • Decision making consistency
That's its job.
Good governance does not guarantee the right outcome. Its purpose is to maximise the likelihood that decisions are made for the right reasons, by the right people, using the best information available at the time.
Ultimately, governance isn't about controlling organisations. It's about creating sufficient governance rigour to enable informed, effective, collaborative and timely decisions.
Organisations that achieve this don't simply govern better; they operate at the Round Table.
Ken De Negri
BSc, MSc, FCCA
De Negri Advisory Pty Ltd
About the author
Ken De Negri is the founder of De Negri Advisory, providing governance, risk, internal audit and sustainability advisory services to organisations across Australia. If this perspective resonates with your organisation or you'd like to discuss how these principles could be applied in practice, feel free to get in touch.