Using Governance as a Strategic Tool to Translate Policy to Practice

The effectiveness of organisations hinges not just on their ability to formulate robust policies but on their capacity to translate these policies into actionable practices. Often perceived merely as oversight or regulation, governance has evolved into a strategic tool essential for bridging the gap between policy formulation and practical implementation. Governance can be leveraged strategically to ensure policies are effectively enacted, driving organisational success and sustainability.

Governance refers to the frameworks, processes, and structures used to guide, manage, and monitor the activities of an organisation. Traditionally associated with compliance and risk management, governance has now become integral to strategic planning. When employed strategically, governance ensures that an organization's policies align with its mission, vision, and objectives, facilitating coherent and consistent decision-making processes.

Governance as a strategic tool involves proactive engagement with policy development, ensuring that every policy is not only aligned with organisational goals but also equipped with the mechanisms for effective implementation. This strategic approach to governance can drive performance, enhance accountability, and foster a culture of continuous improvement. Strategic governance essentially contains some key Components.

Effective governance starts with a clear understanding of the organisation's vision and mission. Policies should be crafted to advance these foundational statements, ensuring that all strategic decisions and practices contribute to the overarching goals.

Governance frameworks must incorporate mechanisms for engaging stakeholders at all levels. This includes internal stakeholders like employees and management, as well as external stakeholders such as customers, suppliers, and regulatory bodies. Inclusive engagement ensures that diverse perspectives inform policy and practice, enhancing buy-in and reducing resistance.

Strategic governance entails a proactive approach to risk management. By identifying potential risks early, organisations can devise strategies to mitigate them, ensuring that policies are resilient and adaptable to changing circumstances.

It should also have performance measurement and accountability. Implementing policies effectively requires robust mechanisms for measuring performance and holding individuals accountable. Governance frameworks should include clear metrics and reporting structures that track progress and highlight areas for improvement.

Governance as a strategic tool should not only have performance measurement metrics but also embrace the concept of continuous improvement. Organisations must regularly review and refine their policies and practices, adapting to new challenges and opportunities in the environment.

The transition from policy to practice is where many organisations falter. This disconnect between policy and practice often leads to the collapse of governance. To ensure a seamless transition, there must be effective implementation strategies too. These strategies begin with comprehensive policy design. Policies should be designed with implementation in mind. This means they must be specific, actionable, and equipped with clear guidelines for execution. Vague policies are prone to misinterpretation and inconsistent application.

There should be adequate training and development of staff. Employees must be adequately trained to understand and implement new policies. Continuous professional development ensures that staff have the necessary skills and knowledge to apply policies effectively in their day-to-day activities.

Much attention must be given to the leadership that will drive the policy and culture of the organisation. Leadership plays a crucial role in driving policy implementation. Leaders must champion new policies, demonstrating their commitment through words and actions. Additionally, fostering a culture that values compliance and excellence can motivate employees to adhere to policies diligently.

Also, adequate resources—be it time, money, or personnel—must be allocated to support the implementation of policies. Under-resourcing often leads to half-hearted execution and suboptimal outcomes of policies thereby imparting governance. 

Lastly, adequate monitoring and evaluation. This ensures that policies are being implemented as intended. This can be done by regular audits, feedback mechanisms, and performance reviews can help identify gaps and areas for improvement.

For example, a mid-sized manufacturing company that sought to improve its sustainability practices. The company developed a comprehensive sustainability policy aimed at reducing its environmental footprint. To move from policy to practice, the company employed strategic governance through the following steps:

  • The sustainability policy was directly linked to the company’s mission of promoting environmentally responsible manufacturing. This alignment ensured that sustainability was seen as a core organisational value.

  • The company engaged employees, suppliers, and customers in the policy development process. Workshops and surveys were conducted to gather input and build consensus around the new sustainability goals.

  • Potential risks, such as supply chain disruptions and cost implications, were identified early. The company developed contingency plans to address these risks, ensuring the policy's resilience.

  • Clear metrics, such as energy consumption, waste reduction, and carbon footprint, were established. Regular reports were generated to track progress and provide transparency.

  • The company committed to annual reviews of its sustainability practices, incorporating feedback and industry best practices to refine its approach.

With the strategic integration of governance strategically, the company successfully implemented its sustainability policy, achieving significant reductions in its environmental impact and enhancing its reputation as a responsible manufacturer.

Moving from policy to practice using governance as a strategic tool requires a holistic and proactive approach. By aligning policies with organizational goals, engaging stakeholders, managing risks, measuring performance, and fostering a culture of continuous improvement, organisations can ensure that their policies are not just well-intentioned documents but effective drivers of tangible outcomes. Governance, when used strategically, becomes a powerful enabler of success, bridging the gap between aspiration and action.

Research & Advocacy Department,

Chartered Institute of Directors (CIoD), Nigeria

28, Cameron Road, Ikoyi, Lagos.

Can Nigeria Companies Strike a Balance Between Green Practices and Profit Margins?