Board Reporting is a fine line of not overwhelming Directors with information where they can miss critical issues and under informing directors who have a legal responsibility to scrutinise and verify that shareholder’s interests are being protected.
With years of experience in creating information for decision makers in multinationals across the globe, I am well aware of the pitfalls of KPIs. KPIs can easily mislead and KPIs are easy to manipulate, both are a risk. Yet KPIs are a valuable tool for decision making. This is a Quandary facing every director. With growing legal action being taken against boards by both shareholders and regulators, this is becoming an increasing vexatious issue.
The problems faced in the board reporting process is a paper based issue. We are looking at the information that is sent to the board as a packet of papers. Our information constraints are based on the number of pages in the report. The issue is driven and constrained by a paper based process.
“Convert Board Papers to an electronic form and the tables are turned, the constraints are lifted and the methodology is completely different. “
With an electronic solution, you can provide KPIs and the detail to aupport them. Directors drill down where and when they need to. Presentation is done on a completely different basis. Directors can use tablets in board meetings rather than just a thick pile of papers that are difficult to navigate through. Directors have access to a search facility to find something instead of having to search through papers. The dynamics and possibilities of electronic board papers to paper board papers are extensive.
But it is More than Dashboards – It is the quality of the Data.
Board information has a regulatory and governance requirement to be verified and audited to insured that Directors are correctly informed and not misled. Dashboards to date are more about presentation and less about information quality and auditability.
Dac4cast has created a foundation to build transparent, controlled, audited and constantly verified governance and strategic information. Ask yourself how many dashboards have faced rigorous audits like Dac4cast, such as a 3 week audit by KPMG and a weeklong audit by APRA with a number of APRA statisticians. Questions Directors and Management need to consider with reporting processes:
What level have management systems in organisations been audited
How do management and directors know whether the KPIs are correct
What controls are in place to prevent KPIs being manipulated to cover up a fraud
What is the skill base and understanding of the staff who compile the figures
Dacono is unique in the market in its approach. We are not supplying technology, we are proving a proven business process.