Information technology governance framework for improving organisational performance

Abstract

Background: Following the corporate failures of the 1990s, factors identified as evidence for these failures extended beyond just weak or ineffective corporate governance models, codes and legislation. Poor management and oversight of information technology (IT) systems were also identified as sources of failure as a result of organisations’ significant utilisation and reliance on IT. For more control and regulations, existing corporate governance codes of practice and the development thereof were reviewed and reformed. Information technology governance reforms were then incorporated into corporate governance codes, and IT governance established as a board-level responsibility. Over the years, studies into board-level IT governance have been limited, and thus the nature of board-level IT governance and its constitutional aspects are not fully known. Objectives: The aim of this study was to identify and assess aspects of IT governance implemented by the boards of companies listed on the Johannesburg Stock Exchange in South Africa. Method: In-depth, semi-structured interviews were conducted. Interview data was thematically analysed and key themes identified. Results: Boards have been effective in terms of IT investments and budgeting, which were identified as key factors in effecting IT oversight. Boards have delegated most aspects of their IT governance oversight to board-level risk and audit committees, thus limiting the level and depth of interrogation of IT oversight by the board. The oversight of board IT governance is weak in outsourced IT arrangements. Conclusion: The implementation of board-level IT governance goes beyond prescribed IT governance principles within corporate governance codes. In effecting their IT governance, boards consider IT projects that contribute to organisational sustainability and those that positively add value to stakeholders, such as employees and consumers.