Accountability
Accountability is synonymous with responsibility, answering for, accounting for, giving compliance, basically at the level of public management. In Latin America there is no consensus or precise definition on what this means and it is still a concept under construction. What is clear is that both in the public and private spheres, there is a need to monitor actions and decisions, so that they are transparent. This is why accountability exists.
Accountability or accountability is an ethical concept that was born in the Institute of Social and Ethical Accountability, which since 1996 has sought to promote accountability. There are 8 types of accountability: moral, administrative, political, managerial, marketing, legal and judicial, relationship and professional constituency.
According to a report in Dinero magazine, there are several corporate governance models, depending on how active the role of the partners is and the number of shareholders the company has. The best corporate governance practices are based on a market model in which a large number of partners have an inactive role.
The role of the Board of Directors and characteristics
The Accountability of a Board of Directors is very important. A Board of Directors can have the best structure, the best functioning, the best members, but if they do not have Accountability it is not efficient. They must be responsible for their decisions before the shareholders, just as they must demand responsibility from the company’s management. They must follow up with management so that they comply with what they said they would do, but at the same time they must also be responsible for their decisions.
- Board members, in addition to having strategic competencies and having a diversity of skills and experiences, must have the ability to maintain the company, the managers, and the Board itself.
- It is considered that the fewer members the Board has, the more manageable it is. A medium-sized Board can promote a higher degree of Accountability. Between five and seven is a good number of
- When there are independent members, they can provide objectivity, but it is not a guarantee of Accountability, since there are cases of external members influenced by compensation, prerogatives or recognition and by pressures of various kinds.
- In Board meetings there must be regular communication through which resolutions are reached. It is ideal to hold more than three meetings a year and no more than six so as not to interfere with the role of management.
- The performance of the Board must be evaluated, as well as that of each of the members, to establish responsibilities regarding their actions and have the ability to remain accountable to shareholders, and to make managers accountable to them.
Mechanisms and instruments to develop this practice
- Information systems and public reports: Basically legal and financial that are presented with certain periodicity.
- Performance evaluations and measurements: analyze internal and external compliance with the organization’s goals and objectives.
- Participatory and consultative mechanisms: Participation is fundamental in accountability, such as community consultation in its various forms.
- Self-regulation: The formation of capabilities based on the reflection of one’s own practices, self-criticism that materializes in procedures such as: codes of conduct, codes of ethics, international letters of responsibility and accreditations or certifications by peers, among others.
- Certification: They involve an external agent that guarantees impartiality and correctness in the application of the criteria to evaluate and according to quality standards.
- Social audit mechanisms: These integrate many tools such as public information, evaluations, participatory mechanisms and self-regulation standards.
Benefits
Among the benefits that organizations highlight, once accountability is practiced, is the increase in legitimacy, credibility and trust. Another benefit is the increase in technical and organizational capabilities, which go hand in hand with the use of available resources.