"Investcorp’s culture is based on trust and shared responsibility, with a high degree of teamwork built into decision-making at every level," Mr Long said. He outlined five cornerstones, in place at Investcorp, which could ensure that good governance remained at the centre of an organisation’s ethos and actions.
The first of these was the alignment of the interests of shareholders, management and customers. "Investcorp’s shareholders and our management co invest alongside our clients," explained Mr Long. "We share the risk -- all of us -- and we share the success."
The second cornerstone involved management taking the same risks as shareholders and clients, and so viewing themselves as guardians of the business. This resulted in a partnership, a team-oriented approach, shared values and a common culture. "Forty per cent of Investcorp is owned by its management. Management ownership is through cash purchases of shares, rather than options or share grants. Thus management takes the same risks as shareholders. We are all accountable to one another and to all of our shareholders. We expect commitment to teamwork and we share an understanding of the value of partnership," Mr Long said.
The third was that all decision-making should be collective. Mr Long pointed out that the corporate world had learned the hard way that things can start to go wrong when individuals to act alone and make big decisions unchallenged by others: "Big decisions should always be made by teams, not by individuals, and no one person should have a right of veto," he said.
Fourth, decisions and actions should be transparent inside and outside the organization. At Investcorp, this was achieved by regular contact with clients and shareholders through a series of formal and informal meetings and opportunities for discussion and feedback.
The final cornerstone was an institutional mindset. This meant behaving in a manner that was professional and team oriented, with talent built around the concept of longevity and shared interests.
"Good corporate governance has been good for Investcorp, its shareholders and clients since its inception over 20 years ago," Mr Long added. "I believe that the recipe for solid governance is an evolving one, that businesses in the region must be flexible and adaptable to new ideas and approaches."
"We have always tried to practice this at Investcorp and part of our culture of synergy and collective decision making means we are good students. By definition we must be open to new ideas and concepts, and this means we are always keen to learn about best practice. If new approaches make sense for our business we will adopt them, and use them to evolve our culture and business practices," he concluded.
The ‘Corporate Governance - Board and Executive Action for Good Governance’ conference sought to harness what had been learned from recent developments in the world of corporate governance to show how this can be applied to help regional business compete even more successfully in global markets.
