All public and not for profit organizations have varying degrees of nine characteristics, depending on the complexity and sophistication of the organization:
To begin, accountability is one of the essential practices of good governance, and it entails the responsible discharge of duties by the Council or Board of Directors. These directors ensure that the decision-making process minimizes the negative affect individuals, groups, stakeholders, employees, or the general public. Additionally, practicing accountability increases public confidence and helps organizations manage risks.
2. Consensus Orientation
For a corporation to practice good governance, there needs to be a consensus among the members. The boardroom is mainly used for this purpose, and in-depth debates are essential, as it allows for a diversity of the organization's thoughts and actions.
Transparency is a principle built on the free flow of resources and information as much as possible. Access to information and important issues need to be available to all members, stakeholders, or the public (where applicable) at the right time. Moreover, the necessary information is also provided in enough quantity to understand and monitor it.
Organizations that practice good governance always adopt better communication practices between directors, stakeholders, employees, or the members/ general public. This is done in due time to enable the provision of honest answers to the organization's direction.
This means that the stakeholders/members and/ or public communicate effectively because they can participate collectively to achieve the organization's goals as needed.
6. Effectiveness and Efficiency
It is equally essential that the organization adopts measures that encourage increased efficiency in all departments. Increased efficiency can include introducing modern and advanced technology in order to increase the output of the organization's activities.
Each director should have the free will to express his or her opinions, philosophies, and experiences. No one should feel left out or feel that their views have less importance to those of others.
8. Rule of Law
The rule of law in good governance means that the board should be fair and transparent in its decision-making process.
9. Strategic Vision
Finally, corporations should have a board of directors with abilities to perform strategic thinking. Having a clearly defined strategic vision leads to the board developing a coordinated and systematic plan to achieve the company's goals.