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For companies in the make, move, and sell economy, governance is critical for ensuring best business practices. Whether you’re a manufacturer, distributor, or retailer, you want to manage all the elements of governance, from security and risk to corporate business practices. To do that, an enterprise resource planning (ERP) system is critical. Far more than a system of record, a cloud ERP can give you comprehensive real-time business information that can enable you to make smarter decisions when it comes to governance.
What is effective governance and why is it important?
Effective governance helps ensure that companies are operating ethically, managing risks, and considering the impact of their activities on the environment and society. Having effective governance in place contributes to overall performance and cost-savings. Effective governance can also help you manage disruptions in uncertain economic times.
Governance consists of corporate governance, security management, risk management, business process management, global trade compliance, electronic reports, and environmental and energy management.
Corporate Governance
Corporate governance relies on accurate reporting for trustworthy data, which means you need to consolidate your data to get a unified view of your operations. An ERP system allows you do this, and therefore helps you automate routine tasks, streamline workflows, and reduce risk for human error. The end result is well-informed decision-making by key stakeholders, because they have clear visibility into financial transactions, HR activities, and other critical business operations.
Security Management
When it comes to security management, an ERP helps provide comprehensive user and group security to restrict data and application accessibility as needed. Security can be granted at user and group levels for all security objects including forms, fields, reports, menus, and method calls.
Risk Management
An ERP provides tools and processes for monitoring and mitigating risks. The only way to truly manage and mitigate risk across your organization is to have a fully integrated, end-to-end solution providing a single, verifiable set of financial and operational metrics.
Business Process Management
Business process management supports your ability to identify and mitigate risks to your organization through business-defined workflow, streamlining processes to make your business more efficient, more disciplined, and better able to adapt to change.
Global Trade Compliance
To conduct business globally, you need enterprise business software that enables compliance with local laws, satisfies international security measures, and meets the myriad local and regional documentation requirements.
Electronic Reports
Reporting legislation is constantly evolving-tax authorities are starting to require comprehensive data submissions on a regular basis, as well as real-time visibility into all transactions.
Energy Management
As the world continues to analyze energy availability, businesses are also turning their attention to areas of opportunity: reduction of carbon emissions, energy conservation, and supply chain sustainability.
Questions to Help Ensure Good Governance
When thinking about governance, ask yourself these key questions:
- Have we taken steps to mitigate the risk of a cyberattack, including penetration testing and employee training?
- Are we ISO 27001-certified for information security?
- How much transparency does our company offer to shareholders?
- Do we have any sustainability or social reporting initiatives?
- Is our supply chain transparent?
With a solid governance structure in place, businesses can continue to thrive and grow in the years ahead.
