The Asset Journal, Volume 12, Issue 2
In this issue of "The Asset" we consider aspects of Governance. Governance is at times equated with Leadership and at times taken synonymous with Management or seen as a Management function. The Governance function in my view is Leadership function that should be extended across an Organisation with responsibilities of the Governance function to be clearly defined. Using the Asset Management Council Systems Model, Governance roles become clear very quickly.
Governance as a role of Senior Leadership, provides specifically the Oversight elements for the Organisation and concerns itself with Strategic Decision making. The need to establish and sustain the ‘line of sight’ is a critical element to deliver the inputs in the management of risk, assurance and decision making at the highest and other defined levels. An equally vital function is to provide and monitor Core Policies. Among these Policies, we anticipate finding more and more Asset Management Policies in the Government Agencies and in Private Businesses. An Asset Management Policy becomes the important Instrument by which the critical decisions about Assets, their effectiveness and the efficiency of the controlling organisation are directed, made and assured. Part of the Governance structure then is the establishment of Purpose, Structure and Value and monitoring efficacy of outcomes with respect to Asset Management.
My brief reflection on the purpose and need for Governance gives me the surety that the requirements of the ISO 5500 series of Standards have it absolutely right in describing the functions of Leadership and Executive Management. Governance functions as described in the Asset Management Standard are the backbone of every Organisation, their Boards and the Leadership function. While Governance provides direction and guidance for Management, we should not forget that Leadership of course is not the domain of the top Echelons of the Business alone, hence Governance applies at all Organisational levels.
Governance then is a critical element in Asset Management as well as Business in general. By necessity it extends to the Business functions and is applicable to all the functions that make up either the simple of more complex structures found in Organisations. I consider it equally critical for delivery of capital Projects that a Governance function is established, especially for large Projects, that assures the Owners and Stakeholders of the appropriate outcome expected form the investment.
I trust that you find inspiration and ideas in the contributions to this edition of ‘The Asset’. We value your feedback about your own experiences with Governance issues in Asset Management.
Editor in Chief