Following our recent transformation process in June, we have officially turned the page on a challenging chapter in our company's history. As we forge ahead, redeveloping and refining our corporate governance procedures has emerged as one of our top priorities.
A reflection of this can be seen in our formation of an entirely new board of directors, as well as the naming of a non-executive board chairman. These changes are among the first of what we hope will be many concrete steps that will enable us to rebuild our corporate governance procedures from the ground up.
Although this process is just beginning, we believe we have already made significant strides. At the end of the first board meeting, for instance, a critical consensus was fostered: A board of directors should exist to serve the interests of the company and its key stakeholders — not the other way around. This foundational belief will continue to serve as the basis of our work at the board level moving forward.
We also agreed to establish a set of core principles to guide each one of our proceedings. In today's fast-paced world, many long-established conventions and professional courtesies that were once commonplace are becoming increasingly uncommon.
What we've laid out below may seem quaint and old-fashioned to some. However, we firmly believe these principles are timeless and represent the fair, honest and proper way to do business. By adhering to them carefully, we hope to cultivate an environment that not only promotes our long-term success but provides a framework that will advise our corporate governance procedures for years to come.
Consider the following:
1. Focus: Sometimes in the business world, meetings can become perfunctory gatherings where minds tend to wander and attention spans falter. To ensure this doesn't become a problem for our board meetings, we've required all members to be fully present at all times, which means the use of mobile phones or other electronic devices is limited to board-related activities. By enforcing these guidelines, we hope to sharpen the focus at each meeting and encourage greater collective participation.
2. Active listening: Of course, being fully present is more than merely putting down electronic devices. It also requires all participants to engage in active listening. By listening carefully to what others have to say, we encourage a more open and honest exchange of ideas, thus enabling our board to make decisions that produce better, more comprehensive results for the company's stakeholders.
3. Respect: One way we can demonstrate respect is the manner in which we welcome outside guests and presenters. Our board is committed to creating a supportive, positive and encouraging environment for visitors, providing them with a proper welcome and ensuring they are acutely aware of our expectations at the outset. This mutual respect and understanding will allow us to make the most of our time with them and further serve to advance our objectives.
4. Preparation: Asking great questions and understanding the assumptions behind company directives and priorities is one of the most important duties of a board member. Our board members have vowed to read all relevant materials diligently, formulate critical ideas about important issues ahead of time and apply fact-based thinking in every regard of their board membership. By doing this, we will be able to achieve the necessary outcomes that will best serve the company, and, more importantly, the advisers and institutions we support.
While some of the above principles may seem simplistic and self-evident, they are as relevant today as they have always been, and we believe the most pragmatic and effective corporate leaders surrender them at their own risk.
This is not to say that other organizations within our industry aren't also instilling these principles. But as we continue our upward trajectory as a reorganized institution, we believe that this simple, back-to-basics approach to the functionality of our board will establish a stable, proactive leadership dynamic that we anticipate will permeate throughout the rest of the company.
Robert Moore is chairman of the board of Aretec, Cetera Financial Group's parent company. Larry Roth is CEO of Cetera Financial Group.