Not-Of-Good-Order (NOGO) GRC Disclosures in Business and the Corporate World
All Governance, Risk Management, Compliance and IT Security (GRC) transactions must be fit for purpose, process and people. They must be conducted with professionalism be it a project or product by all partners. All of these 7 P’s must cover outstanding GRC components e.g. integrity and ethics, committed to the future of the business and stakeholders welfare.
Sometimes, non-disclosures weaken the transparency rules that are designed to combat corruption and poverty in resource-dependent countries. That is the reason why Copenhagen Compliance requires all global companies to follow the Copenhagen Compliance disclosure and transparency recommendations, as key payment disclosures on a project-by-project reporting as a new global standard. Therefore, Copenhagen Compliance introduces Not-Of-Good-Order (NOGO) global disclosure standards.
Unacceptable, significant and frequent disclosure deficiencies
Often the annual GRC review is characterized by the level of non-compliance and rated as "unacceptable" when "significant and frequent disclosure deficiencies" are not registered.
In the past, these failings were often related to director independence or if the board had an independent lead director, the process of appointing new directors or the document the process for identifying new board candidates etc.
For each of the identified GRC deficiencies, the idea is that the board activities should be transparent and disclose these non-compliant components as disclosure in the annual GRC report.
The Copenhagen Compliance Corporate Governance framework provides solutions to monitor and reduce most disclosures. Lack of these GRC compliance disclosures has now advanced to several other governance issues. Therefore, Copenhagen Compliance has introduced the Not-Of-Good-Order (NOGO) GRC transactions and disclosures in business and the corporate world. These NOGO disclosures often result in erroneous, incomplete disclosures due to inefficient GRC processes, and increases the level of non- transparent admissions, transactions and processes.
New transparency requirements
The European Union's Accounting and Transparency Directive requires from 2015 that oil, gas, mining, and logging companies listed or registered in the EU to publish government payments on a project level. There are also related transparency initiatives; e.g. the voluntary Extractive Industries Transparency Initiative (EITI) that also calls for project-level disclosures.
Copenhagen Compliance encourages all companies to embrace the goals of the transparency efforts, and disclose detailed information about payments they make to host countries, in order to provide more accountability, transparency and traceability. The efforts must not be limited to host countries that are resource-rich, but poverty-stricken.
A long list of payments
The annual corporate transparency and responsibility report is based on giving a full understanding of all payments it makes to authorities, governments and other major stakeholders. The report must also include tax disclosure on a cash basis, and disclose payments where the obligation arose from, category-level payments, including items like production entitlements, income taxes, and royalties. Value Added Tax (VAT) payments, withholding tax, Pay-As-You-Earn, and all other taxes are also a part of this disclosure.
There will also be a U.S. law requiring extractive companies there to publish project-level payment information. That provision, part of the Dodd-Frank Act, is currently under the review by the U.S. Securities and Exchange Commission.
That is why GRC components are a set of coherent disclosure rules that even middle-of-the-road directors and stakeholders who often engage their intelligence and judgments in simple ticking the box exercise, can gradually comply by offering reasonable explanations and disclosures to stakeholders on the whole.
