{"id":3388,"date":"2025-12-29T11:29:49","date_gmt":"2025-12-29T11:29:49","guid":{"rendered":"https:\/\/uhy.pt\/?p=3388"},"modified":"2025-12-29T11:28:33","modified_gmt":"2025-12-29T11:28:33","slug":"governance-internal-control","status":"publish","type":"post","link":"https:\/\/uhy.pt\/en\/governance-internal-control\/","title":{"rendered":"Governance &#038; Internal Control"},"content":{"rendered":"<p>Every company must have effective governance. The implementation of a governance model includes:<\/p>\n<ol>\n<li>Diagnosis<\/li>\n<li>Structure and organisational chart<\/li>\n<li>Processes (business, operations, risks and challenges)<\/li>\n<li>Documentation: Critical\/relevant statutory regulations<\/li>\n<li>Benefits of governance<\/li>\n<\/ol>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p><strong>Phase 1) Diagnosis<\/strong><\/p>\n<p>&nbsp;<\/p>\n<p><strong>Objective:<\/strong> understand current practices, identify gaps, clarify vision and priorities.<\/p>\n<p>&nbsp;<\/p>\n<p><strong>Actions:<\/strong><\/p>\n<ul>\n<li>Conduct interviews with partners, senior management and middle management;<\/li>\n<li>Map key processes (financial, commercial, HR, operations, etc.);<\/li>\n<li>Identify and assess risks (financial, operational, succession, etc.);<\/li>\n<li>Inventory existing regulations (statutes, regulations, policies, etc.);<\/li>\n<li>Identify common conflicts within the company (authority, succession, informal decisions, accumulation of functions);<\/li>\n<li>Assess the maturity (scale) of governance.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p><strong>Phase 2) Structure and Organisational Chart<\/strong><\/p>\n<p>&nbsp;<\/p>\n<p><strong>Objective:<\/strong> to clarify roles, responsibilities and decision-making bodies.<\/p>\n<p>&nbsp;<\/p>\n<p><strong>Actions:<\/strong><\/p>\n<ul>\n<li>Define governance bodies (Partnership Council\/Board of Directors\/Executive Committee, etc.);<\/li>\n<li>Distinguish between family roles and professional management roles (\u2018Family Protocol\u2019);<\/li>\n<li>Create a formal organisational chart, job descriptions and limits of authority;<\/li>\n<li>Create rules for succession and for family members joining\/leaving management;<\/li>\n<li>Define and approve the Organisational Chart, Matrix of Responsibilities and Regulations for corporate bodies.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p><strong>\u201cSimple &amp; Best Practice\u201d organisational chart<\/strong><\/p>\n<p>&nbsp;<\/p>\n<p><span style=\"text-decoration: underline;\">Strategic Level (Shareholders\/Family)<\/span><\/p>\n<ul>\n<li>Shareholders&#8217; Meeting<\/li>\n<li>Board of Directors (may include independent members)<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p><span style=\"text-decoration: underline;\">Executive Level<\/span><\/p>\n<ul>\n<li>Managing Director \/ Chief Executive Officer\n<ul>\n<li>Finance &amp; Administration Director<\/li>\n<li>Operations Director<\/li>\n<li>Sales &amp; Marketing Director<\/li>\n<li>Human Resources Director (may be part-time or external)<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p><span style=\"text-decoration: underline;\">Operational Level<\/span><\/p>\n<ul>\n<li>Supervisors\/Coordinators by area<\/li>\n<li>Operational teams<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p><strong>Phase 3) Processes<\/strong><\/p>\n<p>&nbsp;<\/p>\n<p><strong>Objective:<\/strong> to provide the company with clear, simple and documented rules.<\/p>\n<p>&nbsp;<\/p>\n<p><strong>Actions:<\/strong><\/p>\n<ul>\n<li>Identify key risks and challenges<\/li>\n<li>Identify critical processes<\/li>\n<li>Design a risk matrix<\/li>\n<li>Identify control activities<\/li>\n<li>Inventory operational, financial, commercial, and qualitative KPIs<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p><strong>Basic processes + Internal control system + Monitoring<\/strong><\/p>\n<p>&nbsp;<\/p>\n<p>Document procedures\/flows for decision-making, internal communication, and financial management. Smaller processes allow for faster execution, greater workflow, better control, and motivation for success.<\/p>\n<p>The separation of duties allows for better control and interaction between employees and\/or departments (e.g., those who approve payments should not be the same as those who execute them), reducing potential risks of fraud or errors.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li>Draft critical regulations (see list below).<\/li>\n<li>Create monthly reporting dashboard for partners\/management.<\/li>\n<li>Define internal control system (e.g., minimum segregation of duties, validations, light internal audit).<\/li>\n<li>Implement key procedures manual.<\/li>\n<li>Define and approve policies (financial, commercial, etc.).<\/li>\n<li>Define code of conduct.<\/li>\n<li>Design, disseminate, and approve internal control manual.<\/li>\n<li>Define risk management policy.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p>Continuous monitoring and improvement allows operations to be tracked more effectively. To this end, the following activities should be implemented:<\/p>\n<ul>\n<li>Quarterly meetings to review risks, indicators and projects.<\/li>\n<li>Conduct an annual assessment of governance effectiveness;<\/li>\n<li>Promote continuous updating of procedures;<\/li>\n<li>Formalise monitoring (quarterly reports, annual improvement plan and review of regulations).<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p><strong>Phase 4) Documentation \u2013 Statutory Regulations and Critical Policies<\/strong><\/p>\n<p>&nbsp;<\/p>\n<p>Below is a list of essential regulations (recommended minimum):<\/p>\n<p>&nbsp;<\/p>\n<ol>\n<li>Board of Directors\/Shareholders Regulations<\/li>\n<li>Family Charter<\/li>\n<li>Code of Conduct and Ethics<\/li>\n<li>Conflict of Interest Policy<\/li>\n<li>Financial and Investment Policy<\/li>\n<li>Commercial Policy (includes prices, discounts, terms, credits)<\/li>\n<li>HR Policy (recruitment, assessment, progression, discipline)<\/li>\n<li>Data Security and Protection Policy<\/li>\n<li>Internal Control Manual<\/li>\n<li>Risk Management Policy<\/li>\n<\/ol>\n<p>&nbsp;<\/p>\n<p>Supplementary Regulations:<\/p>\n<ul>\n<li>Internal and external communication policy<\/li>\n<li>Legal and tax compliance policy<\/li>\n<li>Regulations on hiring family members<\/li>\n<li>Succession plan<\/li>\n<li>Internal reporting regulations<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p><strong>Benefits of Governance<\/strong><\/p>\n<p>&nbsp;<\/p>\n<p>An effective governance model brings real gains:<\/p>\n<ul>\n<li>Faster and more reliable decisions;<\/li>\n<li>More efficient operation;<\/li>\n<li>Simpler and less burdensome audits;<\/li>\n<li>Reduction of financial, tax, operational, commercial, legal and reputational risks;<\/li>\n<li>Enhanced value of the company in the eyes of investors and partners.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p>Companies that invest in the right combination of organisational structure and regulations not only survive, but grow in a solid and predictable manner.<\/p>\n<p>&nbsp;<\/p>\n<p>Recent studies (Jerab 2023; Danilov 2024; Meidawati 2025) show that well-defined structures and effective governance contribute directly to sustainable performance.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Every company must have effective governance. The implementation of a governance model includes: Diagnosis Structure and organisational chart Processes (business, operations, risks and challenges) Documentation: Critical\/relevant statutory regulations Benefits of governance &nbsp; &nbsp; Phase 1) Diagnosis &nbsp; Objective: understand current practices, identify gaps, clarify vision and priorities. &nbsp; Actions: Conduct interviews with partners, senior management [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":1205,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[57],"tags":[],"class_list":["post-3388","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-grc-en"],"acf":[],"_links":{"self":[{"href":"https:\/\/uhy.pt\/en\/wp-json\/wp\/v2\/posts\/3388","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/uhy.pt\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/uhy.pt\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/uhy.pt\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/uhy.pt\/en\/wp-json\/wp\/v2\/comments?post=3388"}],"version-history":[{"count":2,"href":"https:\/\/uhy.pt\/en\/wp-json\/wp\/v2\/posts\/3388\/revisions"}],"predecessor-version":[{"id":3392,"href":"https:\/\/uhy.pt\/en\/wp-json\/wp\/v2\/posts\/3388\/revisions\/3392"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/uhy.pt\/en\/wp-json\/wp\/v2\/media\/1205"}],"wp:attachment":[{"href":"https:\/\/uhy.pt\/en\/wp-json\/wp\/v2\/media?parent=3388"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/uhy.pt\/en\/wp-json\/wp\/v2\/categories?post=3388"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/uhy.pt\/en\/wp-json\/wp\/v2\/tags?post=3388"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}