Effective Project Governance – A Cultural Sea Change!
Pessimist curses the wind. The Optimist Hopes it will change. The
Realist Adjusts the Sails."
Keywords: Project Governance, SOX, Sarbanes-Oxley, Project Office, Project Reporting, Project Office, EPM.
Effective Project Governance – A Cultural Sea Change! [P029]
The liability of corporate managers and Directors the world over is changing and becoming more personal. Legal liability is being tightened through such measures as the Sarbanes-Oxley Act (SOX) and the Corporate Law Economic Reform Program (CLERP 9). At the same time shareholders and other corporate stakeholders are becoming less tolerant of errors of judgement and loss of control.
These regulatory changes have a common purpose; to increase the predicability of an organisation’s future financial performance and to keep the markets informed of changes as they occur. When these requirements are combined with the enhanced expectations of stakeholders a significant requirement for robust, predictable and auditable corporate project management processes is emerging around the globe. Organisations in countries that do not have SOX style legislation in place cannot ignore these changes; the pressures of competition in the global market place will drive improved performance as will the expectations of owners, customers and other stakeholders.
The challenge now facing every organisation that relies on projects to instigate change and grow value is to move from an ad hoc system of ‘doing a project’ to one that is integrated, robust, repeatable and auditable; ie, meets the organisations legal and ethical reporting obligations. This transition requires the active involvement and understanding of senior management, supported by properly trained and qualified project personnel who have the authority and capability to implement best practice processes and systems.
The question facing senior management in many (if not most) organisations is how long poor, erratic and uncoordinated project performance will continue to be tolerated by their owners, shareholders, clients and other stakeholders?
Having identified the need, this paper will outline a roadmap for meeting the requirements of effective project governance by identifying the four key elements of an effective governance system defining their interaction and noting some of the tools, techniques and standards available to assist in achieving good project governance.
Author: Patrick Weaver
This paper references 3 KPMG reports - PDF versions of the reports are available for download - see below.