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April 5, 2019

Governance for Accountability

by leroywandahsega

Corporate Governance has become ineffective due to conflicting managerial and executive leadership in the community. These roles have been centralized under the control of the governing body controlling the only share available to voters. Through the issuance of a Corporate Charter by the tribal council the Commercial Enterprise Oversight board has controlled that interest since August of 2000.

The Tribal Government issued a corporate charter to the CEO board to replace the Finance and Building Authorities interest in management, which has created a major principal-agent problem with management officials, causing a lack of respect for those who are in an elected executive leadership role or the other eight members of the tribal council more recently.

Information asymmetry has occurred. This is when agents (managers) are better informed than the principals (any tribal council member).

There are many legal contracts and the agency theory (used in corporate management) suggests that the community is experiencing principal-agency problems, like adverse selection where teamwork accomplishments through organizational goals are claimed by others as if it were a creation of their own (Rothaermel, 2018).

Avoidance of the moral hazards created by the conflicts in business and government has created an atmosphere of unethical behavior (Rothaermal,2018) which allows people to put their interests before the voters in the community.

Valuing ethical behavior is not an organizational norm or standard found on a piece of paper, they are too be practiced daily, like areas of accounting and finances. Finance strategies and procurement procedures are not followed to prescribed rules of the Procurement Policy of the Hannahville Indian Community. This has allowed contracts to be secured under the umbrella of a managing board controlled independently of the Tribal Council with no accountability given for strategy and investment in many cases.

Standards and measurements that affect not only profits of the tribal business but social inclusiveness would create a much better environment that promotes the interest of the tribal member and allows them to keep leaders and managers accountable.

References

Rothaermel, F. (2018). Strategic Management. McGraw Hill Education. Retrieved March 17, 2019

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