By Mercedes B. Suleik
The key purpose of the board of directors is to seek to ensure the company’s prosperity by collectively directing the company’s affairs, while meeting the interest of its shareholders as well as relevant stakeholders. The board has manifold tasks which can be helped greatly by an understanding of its VMV (Vision, Mission, and Values).
Among the tasks of the board of directors and indicators of good practice is, before all else, establishing and maintaining its vision, mission, and core values (VMV). Basically, this means that it should determine and maintain the company’s vision and mission to guide and set the pace for its current operations and future development. Further, it should determine and maintain the values that should be promoted throughout the company. And stemming from these three, it should determine and maintain and regularly review the company goals, and determine and maintain the company policies.
To simplify, Vision is what the company aspires to become or achieve. Its Mission answers why it exists. And its core Values define what the company stands for.
Among the things the board should consider when crafting its vision statement is to ask whether it is the result of a process led by the chairman and whether it is endorsed and championed by all its members throughout the company. It should be clearly defined. It should see to it that it is communicated to, known and understood by all its employees and is likely to promote the desired culture of the company. Vision should be inspiring and challenging, yet realistic and practicable, as well as consistent with its Values.
Likewise, the company’s Mission should be consistent with its Values and the requirements of its Vision. Its Mission should promote and sustain good governance advocacy, such as developing and implementing projects and programs in a financially prudent and responsible manner, or fostering sustainability and environment-friendly behaviour.
Similarly, the board should determine and champion the company’s core Values, which should be timeless, explicit, unambiguous and feasible, embedded in the company’s culture. Let me cite some examples of core values that three companies have adopted, which should be well-worth emulating.
The Institute of Directors (ICD) list their core values as: Social Responsibility, Patriotism, Independence, Excellence, Solidarity, and Ethics. The Philippine National Oil Company’s list comprises: Service, Integrity, Professional Excellence, Accountability, and Teamwork. A third example are the core values of the Shareholders Association of the Philippines (SharePHIL) as follows: Fairness, Accountability, Independence, Transparency, and Honor. I find SharePHIL’s list of core values interestingly arranged, as it can be remembered through an acronym: FAITH.
Thus, before all else, the board of directors must be sure what its company is all about, and this means crafting, understanding, and implementing what its Vision, Mission, and core Values are.