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Being Public

Now is the time to act like a public company


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For privately held companies, "being public" – choosing to act as a public company – may yield tangible, financial value regardless of whether or not there is an initial public offering (IPO) in the works. Higher accountability and scrutiny can lead to higher performance. Choosing to act as a public company may produce the benefits of:

  • An effective and efficient finance function
  • Improved decision-making support
  • Value driving internal controls
  • Risk mitigation

Good governance has such value to business that it is mandated for public companies. Entrepreneurial executives are often reluctant to spend money for governance on the grounds that it can be over bureaucratic and expensive. There are rewards available, provided the investment is made wisely in areas where advice can be valuable and not distract from the company's mission. There is also mitigation of downside risk: reduced potential for restatements, attrition of stakeholder confidence and control failures. Additionally, the value that private companies can enjoy includes the following:

  • Experience from tested business leaders helps shape strategies for evolving companies
  • Oversight allows the balance between risk and reward to be managed within the stakeholders' tolerance levels
  • Guidance is given to hiring, incenting and rewarding key employees

 

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