IT oversight: an important function of corporate governance

The opportunities and risks that significant IT investments present, most definitely call for board-level participation. Corporate governance laws and regulations hold boards accountable for company operation, which affects economic performance. Therefore, board members should take well-informed decisions regarding IT strategy. But the board cannot be expected to be up to speed on IT issues. The answer to this could be the establishment of a board-level IT oversight committee, which could communicate IT to the board. IT governance is rapidly becoming an essential part of corporate governance. It appears that corporate boards seem to be making ill-advised decisions in terms of IT and are therefore having difficulty implementing good systems of IT governance. In addition an IT oversight committee would facilitate the board in achieving better legal and egulatory compliance. This paper discusses the need for greater board level participation in the way an organization is directed and controlled, with specific interest in IT related issues. IT has become widely integrated into most organizations but IT issues remain a neglected topic at board level. The general failure by the board to effectively strategically direct and control IT is derived from a lack of adequate skills and insight into IT related issues at board level. Therefore this paper motivates the institution of an IT oversight committee to help advise the board in terms of IT governance and other strategic IT-related issues, and thereby bring about a stronger system internal control and an enhanced approach to corporate governance.