I see many people out there talking about Corporate Governance as if it were some kind of monster. A dull manual, full of rules, an added cost for the company. A bureaucracy that stiffens operations and kills agility. Nonsense. Pure and simple nonsense. OK, the name does not help much, because when someone hears the word Corporate, they picture something bureaucratic and rule-heavy. That is why I tend to follow the line of Business Governance, adapted to companies of any size.
But what they never told you is that Governance is not about paperwork. It is about minimum necessary control. It is about having elements for decision-making. And, in its most raw essence, it comes down to two things: Forums and Rites.
Think about it: where are important decisions made? In meetings. In boards. In committees. Right? So those are the Forums. And how are those decisions made? How often? With what agenda? Who participates? How is accountability exercised? Those are the Rites.
Everything else is noise. Without these two elements of Governance well defined, there is a strong chance of creating a bureaucratic monster. What I see very often is the attempt to complicate the simple in order to justify the existence of consultants and manuals that nobody reads. But I personally believe that: if you master the Forums and the Rites, you master Governance. And if you master Governance, you master the necessary control.
But this is where many get lost, and Governance reveals itself not as a manual, but as a living organism. And, like every organism, it can get sick. When governance does not work, when it stiffens more than it drives, the problem is not in its existence, but in its execution. It lies in the Forums that become stages for vanity, where those without the power to decide gather, or where those who hold the real power to act are excluded, turning discussions into corporate noise.
It also lies in the Rites that get lost in companies that are true meeting factories, with cadences disproportionate to market urgency, or where overlapping commands dilute authority and the capacity to respond. It is at this point that facade governance, the kind that merely "goes through the motions," becomes dead weight, an insurmountable obstacle to management. The difference between a company that soars and one that stagnates lies in the thoroughness with which these Forums and Rites are designed and respected, ensuring that the control architecture is an engine, not an anchor.
The IBGC, the Instituto Brasileiro de Governança Corporativa, which is one of the greatest authorities on the subject, updated its pillars. And they are living proof of what I am saying. They are not ethereal concepts; they are the materialization of what happens, or should happen, in your Forums and Rites. Let us break down these pillars a bit:
1. Integrity
This is a new pillar. And what does it mean? It is not just about not stealing. It is the culture of truth. It is the coherence between what is said and what is done (Walk the talk). Where does this manifest? In Conduct Rites. In meetings where the decision is unpopular but correct. In Compliance Forums that exist not just for show, but to judge and correct deviations. It is loyalty to the organization and to all stakeholders, not just to the shareholder's pocket. Without Forums and Rites that demand this truth, integrity becomes nothing more than a slogan on the wall.
2. Transparency
It is not just about publishing financial statements. It is about information that flows. Truthful, timely, clear, and available to all who may have an interest in it. Not only what the law requires, but what the business needs to thrive. This is a Disclosure Rite. In meeting minutes that are clear and accessible. In Investor Relations Forums that do not hide problems but address them. It is the trust built when there are no shadows, when the Forum decides and the Rite communicates without half-truths. This includes ESG factors, which today are as critical as financial ones.
3. Fairness
Treating everyone fairly. Many understand this pillar to mean equality. It does not. It means recognizing that each person has their own contribution and their own needs. Where is this practiced? In Shareholder Forums that listen to minority shareholders. In the voice of the employee. In Inclusion Rites that ensure diversity is not just a number, but a strength. It is respect for different perspectives, the pluralism that enriches decision-making. Without Forums that open space for all voices and Rites that ensure they are heard, fairness is just a nice word in the annual report.
4. Accountability
Accountability, to me, is even broader than its direct translation into Portuguese. It is the buzzword that few truly understand. It is about assuming consequences. It is about rendering accounts. It is not just about pointing fingers. It is diligence in one's role, independence in decision-making. Where is this proven? In Audit Rites that are relentless. In Board Forums that demand results and accept no excuses. It is the certainty that every act and omission will carry weight, and that the rendering of accounts will be clear, concise, and above all, honest. It is the Forum that does not hide and the Rite that does not tolerate procrastination or that classic indignation without action.
5. Sustainability
It is not just about planting trees. That would be far too easy. It is about the long-term viability of the business. It is about looking at all capitals: financial, human, social, natural, and reputational. Where is this vision developed? In Strategy Forums that are not limited to the short term. In Monitoring Rites that track not only profit but impact. It is the understanding that the company does not exist in isolation, but within an ecosystem. Without Forums that expand the horizon and Rites that ensure continuity, sustainability is just a cost, not a value. Celebration Rites are also important for the sustainability of the long-term vision, as they mark achievements and set new goals.
Escaping unnecessary bureaucracy
There is a great deal of value in Business Governance. It just takes planning and acting in line with the company's needs, without excesses and without turning a blind eye to lack of control. A few tips that I find very helpful:
Decentralize less important decisions. Give a voice to those who need to have input and who can act more autonomously.
When it comes to setting up boards, understand clearly the role of an Advisory Board versus a Board of Directors. The two have different roles and very distinct responsibilities.
Committees can be of great value, as long as they have autonomy. Committees that cannot deliberate perhaps should not exist.
Apply agile methodologies to meetings, with well-defined agendas distributed in advance (along with the material to be presented) and with a clear timeframe for decisions. Short, frequent meetings are more effective than long, content-heavy ones.
Record the meeting, with outcomes and pending items for the next meetings (which should always be reviewed at the beginning, before other topics).
Privacy and Disclosure: The entire Governance process requires clarity about what can or cannot be disclosed. The channel, the forum, the medium, and the scope must always be defined when something needs to be communicated. Making the decision to communicate without evaluating these points can generate the need for further explanation and possible loss of time.
Governance is action, not intention
If you agree with this line of thinking, the next time someone talks about Governance, remember: it is not about what is written in the manual, but about what happens in the Forums and the Rites. It is the invisible architecture of control, whether centralized or distributed. The cadence that defines success or failure. It is action, not intention. And if you are not in the right Forum, or if your Rites are loose, I am sorry to say it, but you do not have Governance. You have nothing more than a bureaucratic manual in your hand. And that waste of time, my friend, is costly. Very costly.
Article also published on GazzConecta.
