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Public Governance

Public Governance. Directing public companies A practical approach. De Meerlanden. Public Limited Company Shareholders – 7 municipalities Waste collecting, composting, sweeping, other tasks in public space 250 people; Turnover € 45 mln. Main objectives:

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Public Governance

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  1. Public Governance Directing public companies A practical approach

  2. De Meerlanden Public Limited Company Shareholders – 7 municipalities Waste collecting, composting, sweeping, other tasks in public space 250 people; Turnover € 45 mln. Main objectives: Activities for 100.000 households 4.000 companies Handling 300.000 tons of waste - sustainability - profitable - governmental influence - market driven

  3. Directing public companiesa current issue Cost effectiveness Risk avoiding Complication of the specific task Internationalisation (waste)

  4. PartnershipModel 1: Municipal Settlement Municipalities Board with politicians (aldermen) Municipal settlement Specifics MS: - Legal status - Political responsibility - Performing public tasks Executing organisation Performing Tasks: Waste collection Green keeping Grit icy roads Sweeping Activities in public space

  5. PartnershipModel 2: Public Company Shareholders = Municipalities • control • advice Board of governors • Specifics Public Company • - Legal status • - Equity • - Entrepreneurial responsibility • Performing public & private • tasks Executive board Executing organization Performing Tasks: Waste collection Green keeping Grit icy roads Sweeping Activities in public space

  6. Governance Two tier model Governance Public Company (1) Shareholders • Profit rights • Merger/ cooperations • Reorganizations • Investment Legal rights concerning the company Company Company can follow a strategy Which has to be approved by shareholders Shareholders: In general: all decision which influence the character and identity of company are shareholders decisions

  7. Governance Public Company (2) Board of governors Governors advisory & control has a status towards ceo and shareholders are appointed by shareholders have dominating influence on strategy and management Company

  8. ROLE of Management-Governors-Shareholders Advice & control Management develops strategy prepares investments or makes annual report Governors influences strategy investments or annual report (dividend) Shareholders approve or disapprove strategy, investments or annual report

  9. Directing a public companyTwo angles: Influence on strategy and identity Influence on the performance through SLA Ad 1) - Highly regulated - Has a legal basis - Is a carrousel of meetings, responsibilities and reports Ad 2) - Entirely the opposite. Little is regulated. No long solid experience.

  10. Influence on performances SLA Municipality A B C D E SLA SLA SLA SLA SLA De Meerlanden nv SLA contains agreements on - Quality - Results - Quantity - Responsibility & risks - Tariff/prices - Contract period - Future policies - Reporting (!) - Complaints Mostly 5 year period. Can also be indefinite. All municipalities have different SLA’s. Not Anyone is the same !

  11. To handle a SLA (1) Two-sided issue 1: Principal 2: Public 3 perspectives: A) Strategic B) Organizational C) Operational

  12. To handle a SLA (2) 1) Principal A) Basic assumption - how much influence - quality - costs Has to described carefully and from a long term perspective B) Set targets (not only on quality & costs) Also - innovation - substainibility - customer satisfaction - policy - flexible set of instruments C) Contract manager is key-function Has too have content, legal & financial knowledge, entrepreneurial empathy, practical, broad view. Also strong internal position. Access to specialists and aldermen. Persuasive qualities. Authorative.

  13. To handle a SLA (2) 2) Public company A)Set your targets regarding to your function B)Organize the work according to requirements in SLA - cost effectiveness - quality - complaint handling - extra work - be flexible - be aware of political environment C)Contract manager Contract manager is key function Qualities: Content, legal & financial knowledge, entrepreneurship, communicative abilities, practical, broad view. Access to operation & management. Persuasive. Spokesman. Authorative.

  14. Waste policy Issue: who has the initiative to develop new policy. Policy stays within municipality+ direct+ responsibility- lack of knowledge- public company pure executing, not gaining expertise Policy at public company + expertise + interaction between different municipalities - indirect - no counterpart at municipality, communication Conclusion: both parties need policy makers. embed it in contract management operate closely together.

  15. Some tips (1) Employees Bankers Lobby groups Company Customers Financial constraints Shareholders Politics Company Legal issues Politics Voters The rest of the world Lobbyists

  16. Some tips (2) And - Be sharp & flexible - No long term contract without challenges - Organize mutual trust - Give public company room to act to achieve targets - It is a partnership

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