Understanding the importance of judgement in governance frameworks

Boards are rarely judged on the quality of their frameworks. Policies, charters and codes create structure, but they do not decide. Governance is tested in moments where rules are silent, information is incomplete and timing matters more than certainty. Boards are ultimately judged on the quality of their judgement when it matters most.

Most boards operate within well defined governance architectures. Delegations are clear. Reporting cycles are established. Assurance mechanisms are in place. Yet governance failures continue to occur, often in organisations that appear compliant, stable and well governed on paper. The explanation is rarely the absence of rules. It is the quality of judgement exercised when those rules do not offer clear direction.

Judgement is tested when risk is credible but not provable. When ethical discomfort exists without a policy breach. When reputational exposure is foreseeable but not yet visible. When delaying action feels safer than acting early. Any attempt to look at these through the lenses of compliance decisions is inadequate. They are judgement calls.

In practice, boards often mistake confidence for judgement. A decisive executive narrative can feel reassuring. A united board can feel effective. Past experience can feel like prescient insight. Yet confidence does not guarantee discernment, consensus does not guarantee wisdom and experience does not guarantee foresight. Judgement requires something more demanding. It requires the ability to sit with uncertainty without retreating into process or reassurance.

This is why governance is most fragile when performance appears strong. When indicators are green and outcomes are favourable, boards are less inclined to interrogate assumptions or challenge narratives. Comfort can mute curiosity. The absence of visible problems can be mistaken for the absence of risk. Judgement weakens not because directors are inattentive, but because the environment rewards agreement and discourages disruption.

A subtle governance risk emerges when boards unintentionally outsource judgement. This can happen through excessive reliance on management narratives, on advisors and assurance providers or on precedent. Decisions become justified by reference to what has been done before or what the policy allows, rather than by deliberate consideration of what the situation demands. The board retains legal and moral accountability, even when its judgement has been silently deferred.

Judgement is also tested in how boards respond to signals that fall outside formal reporting. Culture, conduct and ethical tone rarely present themselves neatly in dashboards. They surface through patterns of behaviour, informal practices and unease expressed in fragments. These signals are easy to dismiss as anecdotal or premature. Yet many failures are preceded by precisely these early indicators. Boards that lack confidence in their own judgement tend to wait for evidence that satisfies formal thresholds. That wait is often where governance fails. By the time that evidence arrives, options are narrower and consequences more severe.

The challenge is compounded by the tension between oversight and interference. Directors are rightly cautious about crossing into management territory. Push too far and the board risks being accused of operational overreach. Pull back too far and it risks passivity. Judgement sits in this tension. It is the disciplined exercise of deciding precisely when reassurance is insufficient, and deeper inquiry is non-negotiable.

Strong board judgement is reflected in the questions that are asked, the timing of intervention and the willingness to act before certainty arrives. It shows up in how boards weigh competing interests, assess trade offs and consider the longer term implications of short term comfort. It is evident when boards challenge respected leaders without undermining authority, and when they prioritise integrity over convenience.

Judgement is not exercised in isolation. It is shaped by board dynamics, culture and leadership. Chairs play a critical role in creating space for dissent and ensuring that challenge is not personalised or marginalised. Boards that equate harmony with effectiveness often suppress the very disagreement that strengthens judgement. The psychological comfort of consensus during good times can discourage the probing questions that responsible governance requires.

For this reason, judgement must also be turned inward. Boards need to examine their own decision patterns, their tolerance for discomfort and their susceptibility to groupthink. The presence of independent directors does not automatically guarantee independent thinking. Independence is expressed through behaviour, not appointment. Boards that actively reflect on how decisions are made are better positioned to identify blind spots before they harden into shared assumptions.

King V makes this expectation explicit. As a principles-based code, it deliberately avoids prescriptive rules and instead places judgement at the centre of board responsibility. It requires directors to apply ethical leadership, exercise independent thought and balance performance, risk and sustainability in context. Compliance with King V is therefore not demonstrated through box ticking, but through the quality of judgement boards bring to complex, ambiguous and contested decisions.

Technology further amplifies the challenge. Advanced analytics, automated controls and sophisticated reporting can enhance oversight, but they can also create distance. Better data does not automatically produce better understanding. Data still requires interpretation, context and challenge. Boards must guard against the illusion that precision equates to insight. When governance is mediated through layers of technology, judgement is required to ensure that the map still reflects the territory of the business.

Good board judgement is not infallible. It does not guarantee perfect outcomes. It is demonstrated through process, not hindsight. Regulators, inquiries and courts do not assess whether directors were reassured. They assess whether directors exercised due care, skill and diligence in the face of uncertainty. They examine whether questions were asked, whether warning signs were pursued and whether action was taken when it still mattered.

In this sense, judgement is the real test of governance because it cannot be delegated, automated or codified away. It requires courage, discipline and self awareness. It demands that boards remain alert when reassurance is abundant and challenge feels unnecessary.

Governance is not most tested when decisions are obvious. It is tested when the right course of action is unclear, the cost of intervention is uncomfortable and the temptation to wait is strong. Boards that recognise this and invest in strengthening their collective judgement are better equipped to fulfil their oversight role with credibility and integrity.

Ultimately, frameworks provide structure and controls provide support. Judgement provides direction. Without it, governance becomes procedural and reactive. With it, governance becomes anticipatory and resilient. In an environment of increasing complexity and scrutiny, the quality of board judgement will continue to distinguish those organisations that merely appear well governed from those that truly are.

Nqobani Mzizi is a Professional Accountant (SA), Cert.Dir (IoDSA) and an Academic.

** The views expressed do not necessarily reflect the views of IOL or Independent Media.

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