Start-ups have been urged to prioritise strong corporate governance structures at the initial stages, in a bid to ensure long-term success and stability.
According to the experts, a strong corporate governance structure is critical for start-ups as it ensures friends and family do not mismanage resources and promotes transparency, accountabilityand fairness in business operations.
One of the experts, President-UT Holdings, Prince Kofi Amoabeng – addressing start-ups and entrepreneurs at the Africa Business Innovation Forum (ABIForum) 2023 held in Accra, stressed that the adoption of good corporate governance structures from the very beginning makes it easy to access funding support, avoid errors and grow the business, as well as mitigate risks and promote ethical behaviour.
“Start-ups need to establish good corporate governance practices from the outset to build trust and confidence with stakeholders, including investors, customers and employees. They can also seek advice from corporate governance professionals or organisations to ensure compliance with legal and regulatory requirements,” said Captain-retired Prince Amoabeng.
He added that start-ups can build corporate governance by implementing a clear and well-defined organisational structure, creating a code of conduct, establishing a board of directors, and regularly reporting on their performance.
On his part, Executive Director – China-Europe International Business School (CEIBS), Prof. Mathew Tsamenyi, emphasised that a strong corporate governance framework sets the tone for an organisation’s culture, values and behaviour; making it more resilient to challenges and disruptions.
“For businesses, the most important thing is about growth and value creation. So, whenever you start a business the most important question is: how am I going to add value to the start-up capital? Good corporate governance is key in the value creation process if you want the business to transcend generations,” he said.
The Africa Business Innovation Forum is an initiative that aims to empower and imbue innovative small- and medium-scale enterprises (SMEs) and start-ups in Africa with a higher rate of growth and innovation.
This third edition was themed ‘Reset and rebuild: building structures that propel businesses beyond their immediate markets’. It provided a platform to engage financial sector players, intellectuals and a network of multiple stakeholders to address key challenges of start-ups and SME development in Africa.
CEO-ABIForum, Precious Gyau said: “Through the ABIForum, over the past three editions we have been convening relevant stakeholders across the public and private sectors to have policy-changing and paradigm-shifting conversations around SME development. SMEs play a critical role in socio-economic development and remain the backbone of economies in Africa, hence the need to empower them for sustainable growth”.
Corporate governance refers to the system of rules, practices and processes by which businesses are directed and controlled. It involves balancing the interests of a company’s stakeholders such as shareholders, management, customers, suppliers, financiers, government and the community.
The forum was held at La Palm Hotel and also featured an exhibition session. The programme received a massive turnout of entrepreneurs and SMEs, beyond the organisers’ expectations.