With a steadfast belief in a business idea the risk-taking entrepreneur pushes on, testing society to improve the status quo. Australian Institute of Company Directors Queensland state manager Richard Moore, tells Brisbane Business News how for every entrepreneur who succeeds there are many who unnecessarily struggle, when all they need is better governance.

The tireless energy of youth can bring great benefits to business, with long hours, 150 per cent devotion to growth and the ability to ignore some advice in the pursuit of their dream. But ignoring advice can obviously be a large drawback as well.

We’ve seen too many businesses that have fallen over because they’ve grown too fast, the sorts of spectacular failures that made ‘entrepreneurship’ such a dirty word in the 80s. It was these entrepreneurs who tarnished the word, but that taintedness is changing.

One of the most important traits of entrepreneurs that needs to be recognised is their ability to improve existing products to the benefit of society, not just by job creation or economic growth, but by testing the way people are doing things and improving as much as they can.

One that really stands out is PIPE Networks which is helping society by improving internet connectivity. Bevan Slattery’s work in building an undersea cable from Sydney to Guam is the sort of entrepreneurship that drives us forward. Then you look at Scott Geiszler and Anthony Russo at Pizza Capers, who looked at the already saturated takeaway pizza market and thought, ‘how can we do this better?’ And as a result we see healthier, more nutritious pizzas.

But not all good ideas come to fruition so well, or sometimes growth is at such a rapid pace that entrepreneurs don’t put in place appropriate governance procedures. We’ve seen too many cases where they don’t stop to look at the organisation’s processes until it’s too late and they meet with accountants to ask, ‘what went wrong?’

It’s a matter of putting simple policies in place. I recently heard of a company which had grown to have millions of dollars in turnover, 140 staff but had no HR policies. Not only do you need official policies towards employees, but you need clear business plans, as well as financial and accounting policies that are up to scratch, not just for compliance, but for strategic purposes too.

Quite apart from legal requirements there are sound business and social reasons for having proper governance processes.

Management becomes a more predictable activity, strategic planning is effective, and customers and investors are more easily satisfied.

One suggestion is to establish an advisory board of directors to actively assist and guide the business forward. What many entrepreneurs do not realise, or forget, is that a board does not and should not get involved in actual management or operations. It is there to help, not to interfere or restrict.

An advisory board is undeniably useful, especially for companies in the early stages of growth. In carefully selecting the right directors, a company will have at its disposal a wealth of knowledge and expertise not always available from their accountant or lawyer. If there are some things that the owner or manager doesn’t know about running the business, or which strategies will benefit the business, the board can advise in this regard.

Having good governance processes and an advisory board may also make it easy to gain funding for the business, especially in these times, for many investors are reluctant to put funds into companies with little to no governance structures. They tend to view such management, unless the entrepreneur has a proven track record, as a sure way to financial disaster.

Entrepreneurship is a baptism of fire regardless of what anyone says. There are some misconceptions that entrepreneurs tend to start off with huge amounts of money behind them, or that they know everything about the industry they’re about to enter. This is simply not the case.

The longevity of a business is not just important for an entrepreneur but for their employees as well. If advice is ignored and a business falls over because of it, then you have a loss to society and a loss of jobs.

Something that governments and education institutions can do is actively support entrepreneurs as is done elsewhere. In the US it’s taught in tertiary institutions as a potential career path, but here you have to stumble upon it. If we give more support to our young entrepreneurs they will be better off, as will society and our economy. Entrepreneurship is only going to be a dirty word if we make it one.

Enjoyed this article?

Don't miss out on the knowledge and insights to be gained from our daily news and features.

Subscribe today to unlock unlimited access to in-depth business coverage, expert analysis, and exclusive content across all devices.

Support independent journalism and stay informed with stories that matter to you.

Subscribe now and get 50% off your first year!

Four time-saving tips for automating your investment portfolio
Partner Content
In today's fast-paced investment landscape, time is a valuable commodity. Fortunately, w...

Related Stories

Fashion retailer Accent Group to cut Glue Store location count in half

Fashion retailer Accent Group to cut Glue Store location count in half

The ASX-listed fashion retailer responsible for such brands as Plat...

Domino's to shutter 100 stores after crusty results

Domino's to shutter 100 stores after crusty results

The board of Domino's Pizza Enterprises (ASX: DMP) waited until...

Accolade Wines owner buys French giant Pernod Ricard’s global wine assets

Accolade Wines owner buys French giant Pernod Ricard’s global wine assets

Australian Wine Holdco, a consortium that owns the country’s ...

Aussie boxing franchise UBX to enter United Arab Emirates

Aussie boxing franchise UBX to enter United Arab Emirates

Brisbane-based boxing franchise UBX has announced its eighth intern...