By Sunday morning we will know the outcome of this visionless, spineless, idea and leadership-free zone that has passed for an election campaign.
Whatever the outcome, we can look forward to more of the same. Sadly.
It is unreasonable to compare the governance of a country to that of a major corporation, they are apples and pears. The objectives are so substantially different it’s absurd to pretend they’re the same.
However, at a macro level, there are striking similarities in the systems, structures and disciplines that should underpin both. Many of the principles that drive successful corporate governance are desperately needed in government.
Long-term financial sustainability
Corporations must generate enough cash flow to sustain their operations. Shareholders, lenders, and customers all have options: they can walk if they don’t see value. That pressure forces financial discipline.
Governments by contrast levy taxes to raise their revenue without the taxed having choice. In addition, they can ‘create’ money by borrowing from the central bank via the issuing of government backed bonds. Short term this acts as a cushion for cycles in the economy, but long term, just like a corporation, there must be an ability to both pay the interest and on maturity, retire some of the debt. Failure to do so will result in economic erosion and eventual ‘banana republic’ status.
The long term rules of ‘financial gravity’ apply equally to corporations and governments.
Development and deployment of human and physical assets
Corporations invest in leadership and capability because returns depend on it. Governments have a deeper responsibility. Their role is to shape the society’s capacity to think, build, and adapt. Education is the backbone of economic and social growth. It is more than teaching the necessary practical skills needed by the economy, it is also the intellectual and emotional development of the country. We chase the sugar hit and skip the slow burn by treating education as a cost centre, rather than an investment with a long term payoff in wider ways than just financial. The price of misunderstanding the role of education is paid in wasted potential and stalled progress.
Building strategic moats
Warren Buffett nailed it: build moats or die trying. Moats defend your competitive edge.
In national terms, it’s about sovereign capability. Countries that do not invest in strategic domains: energy, food, defence, Intellectual Capital, lose control of their future. Sovereign capability is leverage, and without it, we drift.
Compounding and patience
Einstein called compounding the most powerful force in the universe. Most companies struggle with it. Governments are even worse.
The three-year electoral cycle kills patience. Most policies are Band-Aids with media-friendly headlines. Real compounding needs time and resolve, both of which require leadership.
A handful of exceptions stand out in our history: floating the dollar, Medicare, GST reform. Rare moments of a recognition that the long-term always arrives, sometimes all of a sudden.
Seeing the trends and riding them
Both corporations and governments need to play the trend game. Spot it, bet on it, build around it.
But here’s the catch: governments should do what companies cannot. They must back the long-term, risky bets that create public good. They must build the infrastructure: physical, intellectual, scientific, and social that will serve future generations. This requires an agile mind that can take in new information, process it and arrive at a different point, then execute a long term pivot. This governance characteristic is totally absent from our politics, where the focus is on predicting and planning an answer to the ‘gotcha’ question at the next press conference.
Transparency and trust
Trust is oxygen. Lose it and nothing else matters. Great organisations know this. They operate with clarity, keep promises, and hold people accountable.
Governments? Far too often, the reverse. Opaque processes, spin over substance, accountability dodged. When transparency dies, trust doesn’t just die with it—it rots.
Has anyone seen a trace of any of these six characteristics in this election campaign?
Anyone?
