Corporate Governance is the overall way of taking care of both the formal and informal planning of an organization or any other institution with the aim of ensuring that all the resources within reach are utilized to the maximum and that all the opportunities and problems are handled as required. It is generally to create a comfortable working environment for all. Thus governance provides values, strategies, principles and laws by which a set of issues are to be handled (Juda, 2001). This essay delves into the corporate governance dilemma that has led to the various scandals in the early 21st century in most corporate organizations .The paper also gives the way forward and highlights some of the critical areas which should be looked at to avoid getting into such scandals.
In the early 21st century, most scandals that occurred were mainly due to information technology era. Information technology has brought about so many advantages and also in these advantages there are so many disadvantages. Most of our companies are currently using electronic data transfer systems for maximum profits and speed in getting information from different points of the company. This means that both the staff and the clients have access to the company's website, others and their own personal information. While it has become very easy for both the clients and the staff to have information required at any point without necessarily walking to the office, there also exists a loophole regarding how the same information can be interfered with. We should also know that the clients information can be stolen by the staff while the client is keying in the information to the computer directly or the client may use the computer and forget to logout in a cyber café, when another user comes to use the same computer, it may pose as a security risk as the client's information can be stolen.
The second major problem that has led to scandals during this period is lack of data backup. While most computer users are aware of the importance of having a data backup, occasionally we ignore to invest on the best backup solutions available. It is not unless we lose our information that then we wake up and start investing on the best backup solutions in the market. It is very important that while shopping for a powerful database program, we look for one that will serve the very function we want it to. It is also important to look into the issue of having the best backup for that information. With a good backup in place, we can now be sure of not losing important information. In addition, this backup system will also require regular upgrading to keep it up to date. Losing important information may cost a company a lot of money, time and embarrassment that would otherwise have been avoided.
Another looming problem is with the use of email and internet, which is also due to the new technology. While using email and internet, some information can be viewed from other sources which make it possible for outsiders to get the company's confidential information and even alter and completely corrupt it. Viruses can also be spread at an alarming rate by use of email, the moment we start receiving spam mails in our inboxes we can be sure that our email system is already at risk. We should be careful enough to avoid these messages and the junk as much as possible, but not to be so restrictive also because we might also block our prospective clients while trying to avoid the spam and junk mail. In other words, we should have a very powerful emailing system that can detect viruses and junk mail but not mails from potential clients.
Other problems leading to scandals may also include the neighbourhood location of the organization. While looking for a good site to situate a business it is good to know who are who in the neighbourhood and what kind of businesses they are doing in that locality. Let's say you want to put a Financial Service Provider like McBride, it is very important to know if it is safe to run such kind of a business in that neighbourhood, and also know if there are any other such businesses that are being carried out in the same locality. These problems have led many corporate organizations into scandals that end up costing the organization so much to handle at the end of the day.
According to McBride's requirements, he is having such a good vision for his upcoming business and the office plans. However, he should also be very careful with issues of trusting the service provider 100% with solutions such as security for the company. In as much as McBride needs to have a good service provider, I would suggest that he employs either one or two staff members who have a wealth of knowledge on the same area. The reason being that since the staff member will have full knowledge of the information that the service provider is giving to the organization, it will be the responsibility of this staff to assist the organization in tackling problems that the service provider might have left out, or in case the service provider proves to be mischievous and are the ones who are going to tamper with the system later for their own gain.
McBride can also find himself in a problem just in case he forgets to take into account the fact that mostly when information is shared from one place to another the possibility of the same information getting to the hands of the wrong or unintended persons are very high. The fact that the offices are going to be located in far apart states already is a loophole for information to leak out of the hands of the people who are supposed to handle it and into the hands of the people who might work with it in the wrong way (Olsen, 2009),. This calls for high cautiousness and alertness when handling the client information and generally the organization's information.
The other point in which he should be very careful is the language of programming. While purchasing the system it is crucial to know which language the programming is written in. He can go for a very expensive system which at the end of the day will not serve the purpose which it is intended for. Once the application is bought it can be very expensive to change or translate the language that the application is written so as to suit the current user, therefore, before making the decision of buying the application, it is important to know what language it is written in.
Governance rating in America is very advanced and needs one to be up to date with current information in relation to the methods used. Information technology is very much advanced and everything needs to be handled electronically. It therefore requires most investors to be well informed of the new technological knowledge so that they do not make costly mistakes. These investors like McBride should have everything at their finger tips to be able to set their business in order to suit the state of art technology. Just in case they are left behind issues such as having a fax machine which is directly connected to the network and know exactly how it works then you can easily get into unnecessary expenses. There are also electronics like copiers which can be used as a printer, a copier or even a scanner which does not require one to go back to the computer in order to send a document.
It is advised that you know which companies you invest in, since they are the people who will help you grow or stagnate you. It is good to have strong partners who can keep you ahead of the competition at all times. Their practises need to be understood by both and also need to be ready to work together for mutual benefit. If the organization you are going to be partnering with does not have well executed corporate governance then it is not advisable that you partner with it. It is good to partner with companies that you have faith in, the companies that you know you can rely on; it is for a mutual benefit.
McBride and other investors who are into the same business should be a little more careful in handling issues of the service providers, especially when it comes to areas such as selecting an accounting firm. It requires a lot of time to look for the best accounting firm around which will be able to give you what you require in good time. Six months can be long a time when handling some issues but when it comes to closing a fiscal year it can be such a short time since the accounting firm is not yet in place. This does not require one man to run the whole process of sourcing for the best firm around, as the sole proprietor of the company, it calls for more attention to be given to this issue of looking for a good firm, that will not only give an auditing report but also take part in the company's well being.
For a business to achieve its break-even within six months of its operations, it calls for extremely high methods of governance. It is therefore required that McBride have user friendly programmes which are accessible to be obtained and a strong technical backup to assist the clients understand it and feel at ease with it. While also trying to achieve this, it is important to put in mind that above mentioned scandals are mostly through current technology, therefore proper measures also need to be put in place to be able to achieve the company vision within such a short period of time.
Therefore networking is very important and the point of having interoffice connectivity is equally important since the home office needs to know what other offices are doing. This is to say that the way McBride is responding to the rating system is very encouraging; he is well equipped with most of the essential areas that is required for anyone who is an investor in such a business. It is good to be up to date and also to be optimistic. Therefore it is good to stress out the importance of sound corporate governance required in order to achieve the expectations to the company. Thus the company wants to be the best in that region with the art of state technology it is very impressive.
