Innovative instruments in SME governance
Innovative tools in the governance of Smes - In this article Marco Ginanneschi, Chartered Accountant, Statutory Auditor, and Lecturer in Business Management Degree at Link Campus University, addresses the issue of innovation in the governance of small and medium-sized enterprises.
Innovative instruments in SME governance
When we talk about Governance, we always think about the models of large multinational Holding companies or Spas, while in reality the concept is much broader and especially affects Smes that want to achieve a virtuous management of their company.
The first great obstacle for small Italian entrepreneurs who are at the helm of their company and identify it with their person, is to have mistrust in imagining the separation between the ownership of the company and its management.
The current economic emergency highlights to an increasing extent the need to resort to targeted and specialized interventions that are able to meet not only a product innovation as to an innovation in the processes and management approaches now which are very different from the patterns used so far.
A great entrepreneur does not always succeed in being a great manager, as they are well distinct roles that arise from a different and increasingly specialized training.
The intuition and the great ideas of the entrepreneur do not coincide with the requirements of a market strategy or risk assessment that are the prerogatives of the company managers.
The peculiarity of companies with share capital is precisely that of being autonomous legal entities that allow the corporate object of the members who have formed them to be realized. Many companies, in fact, are administered by different subjects than the partners, to which they remain, however, duties and powers of control over the management.
Governance systems
Just to divide ownership from the control of companies, the systems of Governance are born. With regard to Smes, the principles of governance must be a source of support for the costs that an organised and structured structure entails for the principles of effectiveness and efficiency in the management of human capital and financial capital resources.
In this regard, the technology allows us to minimize costs by increasing the level of company security through the creation or implementation of an adequate internal control system, which must be based on first-level controls and the formalisation of their structure, segregation of responsibilities, traceability of data and information (with the introduction and use of blockchain), verification of the achievement of Kpis (Key Performance Indicator), and adequate financial and economic information at least quarterly.
The importance of innovative instruments
In the age of the pandemic crisis it is clear to everyone the importance of adopting innovative tools also of communicative level that allow a constant and periodic information by the board of directors to all members through the use of a report specific, of fundamental importance for the prevention and possible management of conflicts of interest between property and management.
The current economic emergency highlights to an increasing extent the need to resort to targeted and specialized interventions that are able to meet not only a product innovation as to an innovation in the processes and management approaches now which are very different from the patterns used so far.
For more information about the economic situation in Italy click here
