Financial Services firms understand that finding the right Managed Service Provider (MSP) to support their business is crucial to help them succeed in this very complex and highly regulated industry. However, when selecting an IT partner, it shouldn’t just be based on what cloud technology solutions and expertise are being provided. It is equally important to make sure the MSP is well-run and has the same integrity and ethics at the core of its business as your own Financial Services organisation. Having overseen governance at Lanware for over 10 years as a Non-Executive Director, we asked Rosalyn Breedy to share her views on what key factors she believes makes a well-run MSP business and how this can ultimately benefit Financial Services.
1. Why is having a robust governance framework important?
I have seen first-hand that having good governance firmly embedded in the framework of a business leads to a successful and robust organisation. Having strict governance processes in place allows for complete transparency throughout the organisation, and crucially ensures that the right people have the right information, at the right time. It also helps provide a clear idea of what the company objectives are, highlights who is accountable and ensures integrity at all times. This in turn builds trust between all the stakeholders. Providing transparent rules and processes ensures data accuracy and regulatory compliance to help with effective decision-making as well as mitigating risks by ensuring that key people can evaluate risks as soon as they happen.
2. What are the main responsibilities of a Company Director?
Directors of UK companies have a number of statutory and fiduciary duties and need to evidence compliance with those duties. The Companies Act 2006, Section 172 states that Directors have a legal duty to promote the success of the company and should therefore abide by a legal set of rules to ensure the company is run legally and successfully for the benefit of the shareholders, staff and customers. In addition to the board making all decisions made responsibly and in good faith, it is also important to have a short-term, medium-term and long-term strategy and to ensure all the right information is available, risks are highlighted, and the future of the company is sustainable.
As a Non-Executive Director, I realise that I’m also always thinking about the interests of the stakeholders who can’t be present at Board Meetings and so try to think of what questions they would ask, and make sure that all issues and risks are fully discussed and assessed. It is important that Board Directors take this responsibility very seriously to ensure effective decision-making and limit unnecessary risks that could leave shareholders, employees, customers and other stakeholders exposed and/or harmed. The long-term success of a company should be the main aim, always striving to grow and improve.
3. What makes a strong company culture?
I believe that an organisation with a strong healthy culture is fundamental to its success and goes hand in hand with good governance. In simple terms, if a bad culture exists in a business, it is unlikely to survive because the good people will leave, and potential good people won’t join. Therefore, integrity should be integral to the company culture as this leads to trust from the top down and removes silos from the organisation. It creates a better working environment because you always know that people mean what they say and do what they say.
When this trust exists, it makes every communication in the organisation meaningful because you know there are no hidden agendas, and everyone knows what their role is. In my experience, it’s important that integrity is a core company value. Creating a working environment where clear governance processes are in place, will ensure there is complete transparency and accuracy of information, and everyone is clear about their own objectives.
A strong culture can also be built by making employees share ownership integral to a company’s business plan, which makes people feel part of something and want to take pride in their work. This not only benefits the company but importantly customers too.
4. How do you encourage open communication?
Time after time, organisations have failed because people are afraid to say when and where things are going wrong. As such, problems are not quickly resolved and can ultimately lead to a business failing due to customers leaving or low morale amongst employees. Therefore open 2-way communication channels across the organisation is critical to not only allow clear feedback from the directors and management but also to encourage constructive criticism from the bottom upwards and across functional divisions. This means problem areas can be dealt with quickly and openly without any repercussions being faced by the person challenging. I’ve witnessed that where management actively encourages employees to report problems and feedback is seen as a positive rather than a negative, changes can be made quickly for the good of the company and it improves customer service.
5. Which types of companies require good governance?
As I have highlighted, integrity and ethics are integral to any business, but in particular to the financial services industry, where governance, trust and a strong culture are paramount to running a successful organisation. As one of the most highly regulated industries, strict processes are crucial to collect, manage, monitor and control financial information, prevent conduct failures and remain compliant at all times. In addition to this, Financial Services businesses need to have good communication channels and complete trust with their stakeholders, including their IT partners. I believe that having an equally well-run MSP with high governance standards to look after technology requirements is a real benefit to a financial services business.
Rosalyn Breedy, Non-Executive Director, Lanware