Certified Development Company - Corporate Governance

This is an important area of concern for CDC boards and management. More than ever before, SBA has taken an active role in overseeing CDC's and one of the first things they want to review is the CDC's approach to governance.

• Does the overall structure make sense and comply with the minimum requirements in the CFR and SOP?
• Are there adequate checks and balances in place to mitigate fraud and financial loss/reputational risk to the Federal Government?
• Does the CDC fairly represent diverse components of the community and what is in place to ensure fair lending, hiring and other reasonable business practices
• Is there an adequate communication system in place between senior management, the board, loan committee and staff and does the CDC faithfully follow their prescribed procedures?
• Is senior management and staff fairly compensated (not too high, not too low) for current market conditions?

These are just a few of the questions that we pose when we work with a CDC client on corporate governance issues. There is much more to be discussed about how to appropriately involve a board of directors to obtain optimum guidance without having an outside group that micro manages to the detriment of the health of the CDC.

How about mergers and acquisitions? Is your CDC financially capable of weathering the current economic storm or would it make sense to entertain a merger approach or possibly a "buyout". There are numerous positive solutions to even difficult circumstances. We have extensive experience with M and A and we would be happy to share that experience with you and your group as you look for ways to survive and thrive in the coming years.