The End of Corporate Governance: Hello ‘Platform Governance
The 21st century has brought on many changes in the corporate world. It is easy to see the advent of technology affecting the work and board space, as seen in the new ways of compiling documents, taking minutes, or simply having a video conference. However, more important than the surface level technologies is the rise of new business strategies and governance strategies that encourage innovation.
In the past, ‘Corporate Governance’ was a centralized and hierarchical structure. The company focused on their internals and looked at external matters as stuff ‘outside’ of company affairs. Priority was given to the main shareholders of the company. Orders and the direction of the company came from the top down. This limits innovation and communication with stakeholders.
The paper advocates a ‘platform’ based company structure and for a board to adopt ‘platform’ governance instead of corporate governance. A company that operates under a platform connects groups of people, information, and its stakeholders more effectively. If traditional company is hierarchical and operates from the top-down, a platform-based company operates on a flat structure where the input of all stakeholders are valued. Stakeholders aren’t just limited to employees or managerial staff. Platforms connect a wide web of producers, consumers, manufacturers, and distributors, to one another. All of them are stakeholders which would have varying levels of access to the company.
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