Corporate Governance In Finance

Board minutes are boring. Until the regulator, the buyer or judge reads them. Then suddenly they are the most important document in the room. The Crispin Odey story in the FT this week demonstrates why. He fired his executive committee twice. Installed himself as the sole member. Then held a meeting alone - with minutes recording an attendee who says they were not even there, with comments attributed to them that they say never happened. That is not a typo - it is alleged falsification of a legal record. Under s.248 Companies Act 2006, every UK company must record directors' meeting proceedings and keep them for at least 10 years. Fail and every director in default commits a criminal offence. But the stakes have quietly got higher. Since the Economic Crime and Corporate Transparency Act 2023, boards can defend against the new failure to prevent fraud offence by showing proper prevention procedures. Good minutes are part of that evidence base. Most boards have not connected those dots yet. And minutes disclosed to the CMA or FCA can be shared with overseas regulators. Your private boardroom discussion can end up in front of a regulator in a country you have never set foot in. What I look for in M&A due diligence Board minutes are where the real story lives. I check for: – Who authorised that acquisition, loan or dividend – Was the authorisation what was required by law (you'd be surprised how often it isn't!) – Whether conflicts were declared and managed – Whether directors considered solvency before distributions – Evidence of genuine debate, not rubber-stamping – How the board handled problems when they arose Good minutes can underwrite a valuation. Bad ones can be part of a thousand papercuts that kill deals by telling the story of poor governance. What to do when the draft minutes leave things out This is where most directors are far too passive. They get a draft - they skim it, approve it, move on. If the draft omits something that matters, ask for the change promptly and in writing. Especially if it leaves out: – A material concern you raised – Genuine challenge, not just consensus – A conflict disclosure – The reasoning behind the decision, not just the outcome – Your dissent or abstention Minutes should not be a verbatim transcript but they need to reflect what actually happened - not the sanitised or the politically convenient version. The real one. 𝗢𝗻𝗰𝗲 𝘁𝗵𝗲 𝘁𝗶𝗱𝘆 𝗱𝗿𝗮𝗳𝘁 𝗵𝗮𝗿𝗱𝗲𝗻𝘀 𝗶𝗻𝘁𝗼 𝘁𝗵𝗲 𝗳𝗶𝗻𝗮𝗹 𝗿𝗲𝗰𝗼𝗿𝗱, 𝗵𝗶𝘀𝘁𝗼𝗿𝘆 𝗯𝗲𝗰𝗼𝗺𝗲𝘀 𝘄𝗵𝗮𝘁𝗲𝘃𝗲𝗿 𝘁𝗵𝗲 𝗱𝗼𝗰𝘂𝗺𝗲𝗻𝘁 𝘀𝗮𝘆𝘀 𝗶𝘁 𝘄𝗮𝘀. If you doubt that, read the Odey coverage again. Board minutes look dull and they feel procedural. But when things go wrong they are the difference between "The board carefully considered this" and "The board, apparently, considered nothing." Boring documents save careers. 👉 What is the worst board minute mistake you have seen - too thin, too polished, or simply wrong?

I don’t actually work in finance. I work in trust. Without it, capital markets collapse. Clients walk away. Careers end in minutes. I've watched brilliant finance professionals destroy their careers in minutes.   Not because they lacked technical skills, but because they crossed ethical lines they didn't fully understand.   The CFA Institute Code of Ethics stopped me cold when I first read Standard III.A:   "Members must act for the benefit of their clients and place their clients' interests before their employer's or their own interests."   Before your employer. Before yourself. Always.   In an industry built on conflicts of interest, this isn't just radical. It's revolutionary.   The standards create crystal-clear boundaries: → Market manipulation? Prohibited. → Client suitability? Mandatory assessment. → Conflicts of interest? Full disclosure required. → Material nonpublic information? Can't touch it.   But what really struck me was Standard V.B.5: "Distinguish between fact and opinion."   In a world drowning in financial noise, this simple requirement changes everything.   200,000+ CFA charterholders worldwide have sworn to uphold these standards. Not suggestions. Requirements.   When everyone else chases commissions, you're bound to put clients first.   When others blur the lines, you maintain clear boundaries.   When the industry rewards complexity, you're required to communicate clearly.   Finance without ethics is just sophisticated gambling with other people's money.   But finance with a moral compass? That's how you build trust that compounds over decades.   The Code doesn't make you rich overnight. It makes you trustworthy for life.   And in finance, trust is the only currency that never depreciates.   Every time you're tempted to cut corners, remember: Your reputation takes decades to build and seconds to destroy.   The real edge in finance isn't finding the next alpha. It's earning trust and keeping it. Now, since we are on LinkedIn, I have a question for you: Are today’s finfluencers held to the same ethical standards as CFA charterholders? Should they be?   PS. If you made it this far, ♻️ share this with your network and 🔔 follow my profile!

Cambridge Centre for Alternative Finance, Cambridge Judge Business School - The Next Frontier in Digital Asset Market Infrastructure: Lessons from Digital Public Infrastructure (DPI) - The latest report from CCAF maps the global transformation of market infrastructure through the lens of DPI — from real-time payments to digital IDs and consent-based data sharing. - The implications for the future of digital assets and tokenized finance are massive. Five Insights on the Infrastructure Shaping Digital Markets: 1. DPI Meets Traditional Financial Market Infrastructure (FMI) - DPI like India’s UPI and Brazil’s Pix are converging with FMIs such as RTGS and clearing houses — redefining how value moves in a digital economy. - The ability for non-banks to directly settle in central bank money, as seen in Brazil’s Pix, shows how market rails are opening up. 2. Modular & Open-Source Infrastructure as a Competitive Edge - Open APIs, modular infrastructure, and consent-based data sharing create composable financial ecosystems. - Think of it like Lego blocks for finance — enabling fintechs, banks, and DeFi protocols to build faster, more tailored solutions, but governance and interoperability will be key to prevent fragmentation. 3. Emerging Markets Are Proving Grounds for Infrastructure Innovation - With 113 jurisdictions deploying at least one DPI pillar, emerging markets like India and Brazil are setting global precedents. - For example, India’s UPI processes over 17 billion transactions monthly, outpacing even Visa and Mastercard domestically 4. Regulatory Coordination is Lagging Infrastructure Development - The report warns of a regulatory "knowledge gap" — the pace of market infrastructure innovation is outstripping regulators' capacity to oversee risks like data misuse, concentration, and exclusion. - Coordinated, cross-border regulatory frameworks will be critical as DPI and tokenised markets mature. 5. DPI as a Catalyst for Tokenisation and Digital Assets - By embedding digital identity, instant payments, and secure data sharing, DPI creates the foundation for broader adoption of tokenised assets, programmable finance, and embedded financial services. - Without such infrastructure, digital asset markets remain siloed and friction-laden. Real-World Parallel - In tokenisation, the European Union’s DLT Pilot Regime is laying new rails for trading digital securities — but it’s jurisdictions with mature DPI that will have a competitive advantage in scaling these markets. So What? - For digital asset innovators, policymakers, and financial institutions: DPI is not just about financial inclusion — it’s the infrastructure layer for the future of digital markets. - The race is on to build, govern, and standardise this infrastructure globally — those who lead will define the next era of finance. Great work Pavle Avramović, Sanya Juneja, Yue Wu, krishnamurthy S and Bryan Zhang

Is there room for ethics in the investment world? Managing someone else’s money is a privilege, not just a job. Every decision doesn’t just affect a portfolio—it shapes lives, futures, and families. When someone trusts you with their financial well-being, integrity isn’t optional—it’s mandatory. Ethics is about doing the right thing, especially when no one’s looking. It’s about being honest, transparent, and always putting the client first, beyond short-term gains or pressure from the crowd. True ethics come from constantly checking yourself. Ask: “Am I really acting in my client’s best interest?” Look to those who lead with integrity and let their actions inspire you. Ethics isn't a one-time choice—it’s a habit built over a lifetime. When things go south, as they sometimes will, honesty is your only option. Lying, even to yourself, will destroy trust, tarnish your reputation, and erode your own moral compass. In the end, it’s not about the returns—it’s about the trust, relationships, and lives you’ve touched. That’s the real legacy.

One of my favorite classes at Wharton this term is Mergers & Acquisitions, taught by Professor Emilie R. Feldman. Before this last lecture, I assumed that major M&A decisions were always driven by careful due diligence and boards asking difficult questions. What surprised me was how often they are not. The most useful lesson had little to do with valuation models. It was about psychology. A CEO may become overconfident, emotionally attached to a deal, or afraid of losing it. Investment bankers may encourage the deal because they benefit when it closes. Lawyers may suggest protections, but those can be pushed aside because no one wants to slow things down. As momentum builds, the question can quietly shift from: “Should we do this deal?” to: “How do we make it happen?” The board may not always provide the necessary challenge either. When a board is too closely aligned with the CEO, the people meant to be a check can become an echo. One statistic stayed with me: only around 10% of deals terminate for regulatory reasons. A deal can be legally allowed and still be a terrible strategic decision. Companies cannot depend on outside regulators to protect them. The challenge must also come from within. That is why guardrails matter - and why they must be created well before a deal is on the table. Red teams and green teams are one example. One team builds the strongest case for the deal. The other challenges the assumptions and searches for risks. The goal is not for one side to win. It is to make sure the difficult questions are asked before the decision becomes irreversible. Even experienced and confident CEOs can make poor decisions, especially when emotion, pressure, and momentum are all pulling in the same direction. The best decisions do not rely only on smart people. They rely on systems that protect smart people from themselves. #WhartonLife #MergersAndAcquisitions

Corporate boards are under pressure from investors, regulators and markets to align with evolving disclosure requirements and rising expectations around managing climate and nature-related risks. Traditional governance focused on short-term shareholder returns is no longer appropriate in today’s context. The 𝗙𝘂𝘁𝘂𝗿𝗲 𝗼𝗳 𝗕𝗼𝗮𝗿𝗱𝘀 research by the Cambridge Institute for Sustainability Leadership (CISL), in collaboration with the global law firm DLA Piper, explores how boards can adapt to this changing landscape, not just for compliance, but to lead. Key Questions 🔹 What global legal and governance trends are reshaping boardroom expectations? 🔹How well do these trends align with a sustainable future? 🔹What practical implications do they have for how boards operate? The research identifies: 💡 7 legal trends directly linked to sustainability 💡 3 “big picture” shifts in board governance 💡 12 emerging practices shaping the future of boards What really sets companies apart is how they approach sustainability. Some still operate in a business-as-usual way, focused mainly on short-term returns. Others are starting to take a longer view, recognising that lasting value depends on respecting environmental and social limits. The most forward-looking boards go further, they put purpose at the centre, seeing profit as a means to achieve it, not the end goal. Moving from short-term thinking to a purpose-driven model is not just an adjustment, it’s a leadership challenge that requires boards, investors and policymakers to step up. 📄 This report is the last in a series of four of “The Future of Boards”: 🔗 https://lnkd.in/d_wyen9c Attached are 20 pivotal questions boards can use to guide discussion and strengthen their readiness for a sustainable future. #sustainability #governance #climateaction

The Chocolate Finance fiasco should worry all startups that don’t have a comms team. Now, first, let’s be clear. A Comms executive is not a Marketing executive. They may sit under the same umbrella of Marketing but their roles couldn’t be more different. A Comms executive job is to shape narratives, manage crises, and maintain trust with stakeholders—investors, media, customers, and employees. Their job is in anticipating risks, controlling messaging, and ensuring the company’s reputation remains intact, especially when things go south. A Marketing executive, on the other hand, is focused on growth—driving sales, acquiring customers, and building brand awareness. They craft campaigns, optimise conversions, and push engagement. The difference is seen when a crisis like Chocolate Finance happens. Marketing asks, “How do we spin this?” Comms asks, “How do we contain this?” I’ve interviewed many CEOs and spoken to many business leaders. Some new, green, and accidental. Some stalwarts, veteran, and planned. Unfortunately, the lack of foresight in hiring a Comms executive is experience-agnostic. For a lot of these CEOs, their focus is on the product. So they hire engineers. They hire product teams. They hire Sales leads. Is it complacency or poor foreboding? I’m not sure. But I understand—I do. Still, that doesn’t explain the many panicked messages I get from CEOs asking me how they can comms their way out of a crisis. I do offer advice, for sure, but I should reiterate here that reputation management cannot be an afterthought. It is not something to deal with when a crisis happens. By then it’s too late to get anyone on your side. Because the terrible truth is that when your company is under duress, you tend to lose all sense of reason. Each media attack and every hurtful comment becomes personal. Suddenly it’s just you against the world. Suddenly nothing makes sense. Suddenly “For what, all this?”. And then your first response is to fight. To be defensive. To throw a tantrum. To lash out. The alternative is even worse—take flight. You stay quiet and keep your head down hoping it all goes away when you wake up in two weeks. It perhaps would but what is left in its wake is a city in rubble. A city nonetheless. But one that is in ruins. So do this. If your concern is budget, keep a freelance communication expert on retainer and utilise their services for the occasional interview here or the podcast episode there. Or when either is not scheduled, use the time to craft messaging and structures that you can reach for in duress. Too many startups think comms is a luxury, an optional hire, a nice to have after engineering, product, and sales are sorted. It’s not. It is in fact the difference between a company that weathers a storm and one that drowns in it. And as a journalist, I can assure you that the latter always makes for better fodder.

Most model risk frameworks were built to govern predictions. Agentic systems are designed to take actions. That distinction is becoming increasingly important as financial institutions move from isolated AI models toward AI-enabled workflows capable of initiating decisions, triggering processes, interacting with tools, and operating across multiple systems. The challenge is that many governance structures still focus primarily on the model itself: accuracy, validation, explainability, and monitoring. Those controls still matter. But in agentic environments, the real operational risk increasingly sits elsewhere: in orchestration layers, delegated authority, escalation pathways, tool usage, and end-to-end decision flows. In the latest edition of The Data Science Decoder, I explore why traditional model risk frameworks need to evolve for agentic systems and why governance must expand from “model governance” toward “decision-system governance.” The article examines: 💠 where existing MRM approaches still work 💠 where they begin to break down 💠 and what firms should prepare for now This matters because the next generation of AI failures in regulated industries may not come from inaccurate models alone, but from poorly governed autonomous workflows operating inside complex enterprise environments. Curious to hear how others are thinking about governance boundaries, escalation design, and runtime oversight as AI systems become more operationally autonomous.

When Rajiv was offered a CEO role at a mid-sized tech company, the headline number looked impressive — nearly 40% higher than his current pay. But when he unpacked it, he realized: The fixed pay was modest. A big chunk came as ESOPs vesting over 4 years. The bonus was tied to aggressive targets that depended on a market expansion not yet tested. On paper, it was a dream. In reality, it was the board’s way of testing his skin in the game. This is the politics of executive compensation. It’s not just salary — it’s strategy. Companies use pay structures to align incentives, retain leaders, or quietly signal risk. Don’t just look at the CTC headline. Break it down. Ask: Is this pay designed to retain me, motivate me, or test me? Negotiate not just for today’s number, but for tomorrow’s value.

Most startups don’t fail because of competition. They fail because the foundation was never set right. That’s the insight I couldn’t shake after recording the first episode of my new podcast, Backstage with Builders. It’s a series where I talk to the people building real businesses in tech. Founders. Operators. Decision-makers in SaaS, IT, and fintech. No top production. Nothing too crazy. Just what really happens behind the scenes. My first guest? Pratheesh Chambeth. AI entrepreneur. Software builder. Founder of Capisso - an AI tool that automates bookkeeping. He created 350+ tech jobs. Working between Kerala, Ireland, and Spain. And he said something that stuck: "The majority of startup founders I’ve encountered fail before reaching the legal stage." Let that sink in. But legal is very important, according to him. And he explains why getting the foundation right is non-negotiable. Legal isn’t something you fix later. It’s something you build on from the start. And before you get confused, here's what the right legal foundation looks like in India: 1// Choose the right structure Private Limited or LLP? Register with MCA. Get your DIN and DSC. Don’t overthink - just start with the right base. 2// Protect your IP early Your logo. Your software. Your brand. Protect it with trademarks and copyrights. And yes - use NDAs when needed. 3// Stay compliant from Day 1 GST registration. IT Act compliance. DPDP readiness. You can’t grow if the ground beneath you is shaky. 4// Get the right agreements in place Founders’ agreement. Shareholder terms. Employee contracts. Don’t leave roles, equity, or ownership to chance. 5// Keep your docs in order Digital storage. RoC filings. Contract backups. What you can’t track, you can’t protect. Startups that take legal seriously: • Survive longer • Scale better • Partner faster • Raise smarter Thanks again to Pratheesh Chambeth for dropping that gem. If you’re building a company and want the full conversation - it’s in the comments. More episodes soon. More lessons behind the scenes. --- ✍ Tell me below: What’s one legal mistake you wish someone had warned you about earlier?