Of the importance of accurate governance

TheClubDeal

TheClubDeal celebrated its first year anniversary on November 30 during a walking dinner given to an exclusive public of investors and entrepreneurs.

TheClubDeal, a holding company, invites co-investors to join in the projects it has selected with strict scoring criteria. It also supervises with strict processes the adequate implementation of good governance.

Governance is central in each participation of the TheClubDeal. At the opportunity of its walking dinner, it released its “Governance Handbook” – a guide for the entrepreneur and the investor.

The common finding of many private equity investors is that the adequate governance is an alchemy – an array of processes, rules and attitudes - which may support the growth and eventual success of any of those companies. Obviously, no universal receipt exists as such. Although, there are some learnings to be drawn by those experiences, as to their convergences.

Corporate governance has been and is more and more a development field for many academics. We have seen a lot of literature flourishing since the Enron and Parmalat scandals, multiple think thanks and action groups arose on national or international level. Its general principles are widely accepted now but are unfortunately not yet recognized at their true value inside all ventures. In practice, governance is too often on the bottom of the priority list of an entrepreneur (SME, Startup, …) whose focus is to run the company. This leads us to the conclusion that there is still a gap between the theory and the practice.

While there exists no university, as of today, for accurate corporate governance, nor positive screening as to eligibility for such functions, there are many illustrations where such readiness and awareness of the challenges involved, would facilitate the development of each company in need for governance.

The whole rationale for founding TheClubDeal is of facilitating the relationships between executive founders and/or developers of companies and their investors, so to avoid surprises. The inherent fate of a company is to face and cope with evolutions inside (team, incidents,…) and outside the company (competition, regulation, environment).

Those evolutions may be bad, or, preferably, good.

A good governance will favour a common understanding of the stakeholders, at their respective level, of the actual evolutions of the company, leaving the factor “surprise” to badly governed companies. Evolution is a need inherent to all companies willing to further creating value while coping with direct and indirect competition.

The “Governance Handbook” is an iterative opus, that will further evolve with new recipes and recommendations for avoiding misunderstandings between entrepreneurs and their stakeholders.

At TheClubDeal, we believe that good governance aims at fostering an entrepreneurial culture of partnership between all parties involved so to align goals and interests in a sphere of mutual trust.

You may request the Handbook by sending us an email to info@theclubdeal.com

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