What Is A Governance Agreement

Governance and contract management functions should also reduce the likelihood of potential pitfalls such as those listed below. The agreement should define the responsibilities of each of the parties in a fair and transparent manner. It should establish a fair code of conduct and preserve the interests of both the company and its investors. Some issues that need to be taken into account when developing an agreement on corporate governance It should be noted that these structures and the requirements for good collaborative relations between the parties do not divert attention from the contractual obligations of both parties. In addition, the government should take over the structure that best corresponds to existing internal structures and governance arrangements. It must also be adapted to the complexity of the project so that the resources and structures used are adequate given the size and complexity of the project. The principles of corporate governance help create a clearly defined and implemented structure that works for the benefit of all stakeholders, ensuring that the company adheres to recognized ethical standards, best practices and formal laws. Since the agreement is legal and binding, interested parties who deviate from the agreement may also be convicted in the event of damage or fine. In fact, a written agreement can prevent these „family“ relationships from breaking down. This is because an effective agreement ensures that rules and powers are respected when the organization is faced with a sense of partnership, a financial crisis, a legal issue or a natural disaster. In the absence of written guidelines, the House can make decisions in the blink of an eye – creating a ripe environment for missteps, arguments and bitter ends. The addition of clarity defines a number of policies and procedures that keep the group together in the most difficult moments.

Many doctors ask why it is important to make the details in writing. „We`re just a small practice, not a hospital,“ they tell us. Or: „It`s not the city; we don`t need to be so formal. Or: „Our group of doctors is like a family. Although these things are true, a good governance agreement is essential, whether a group has two or a hundred doctors, whether in the country or in the city, and especially when the culture is „like the family.“ Good practices in the governance structures of P3 contracts require different levels of interaction between the two parties. An example is the use of a partnership committee, a contract management committee and an operational board of directors, directly in relation to the contract management team. Figure 7.3 presents a typical PPP structure with the members of each board member and bodies, as well as their lines of communication. This is a typical structure for the overall supply of PPPs.