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The Diligent team
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What is data governance and how should boards approach it?

July 12, 2018
0 min read
Futuristic image looking down at the world with connected dots across the rim of the earth, representing data governance

Data is a corporation's longest-lasting asset. It lasts beyond people, devices and facilities. Data governance combines analytics with governance requirements. Many corporations mistakenly align the issue of data governance with their IT departments. In reality, data governance more closely aligns with business initiatives.

Customers touch multiple departments in many industries, including sales, delivery, installation, customer service, warranty and maintenance. Each of these departments uses different language and terms. Data becomes less valuable when different departments use the same terms and define them differently. Boards and managers need to be able to trust the quality of data to get the full value from it.

Boards should approach data governance by understanding clearly what it means and knowing how to manage it overall, which will help them manage it consistently.

What Is Data Governance?

The Data Governance Institute puts forth an accurate definition of data governance. Their definition describes data governance as 'a system of decision rights and accountabilities for information-related processes, executed according to agreed-upon models which describe who can take what actions with what information, and when, under what circumstances, using what methods.' The gist of this definition relates to how corporations set up their framework and create processes to manage their data.

Data governance incorporates and consolidates information about people, processes and technology.


Corporations need to build a team that's responsible for data assets and the best way to manage them. A data governance team is accountable for the quality of data throughout all departments in the corporation. The team supports data quality activities and initiatives across the corporation and ensures that data governance initiatives are aligned with the needs of the business.


The first duty of a data governance team often begins with defining how the corporation will manage data in every department. This includes knowing how they store, move, change, access and secure data. Data governance teams must work together to control, audit and monitor processes. This task is especially important in highly regulated industries where compliance is a high priority.


Various types of software solutions will help data governance teams to find initiatives that support best governance practices. Teams should be looking for software solutions that enforce their business rules and ensure data quality across the enterprise. Monitoring and software solutions will aid in collecting and analyzing data.

Best Practices for Data Governance

Best practices for corporate governance suggest that data governance should be lean and balanced. Board oversight should focus on governing data to the least extent possible while still being able to achieve the greatest common good. Boards should encourage data governance teams to create a broad vision and framework with a limited application and expand their approach as they need to.

Regardless of which department generates data, the three most important earmarks of data governance are content, accuracy and timeliness. Low-quality data usually has a negative impact on the corporation and its operations. Data governance teams should construct a system that supports quality data.

Corporate data is sometimes important to share with other interested parties. Data governance teams should make sure that data is not only accurate and timely, but that it has meaning for those who may request it for various reasons. Data governance teams should be prepared to provide data that is easily understandable and meaningful for employees, external stakeholders and members of the community as they request it.

Part of the role of the data governance team includes educating others about data quality. Members of the team should teach employees how to distinguish good data from bad data as they encounter it in the context of their environment, as it pertains to their role in the organization and as the board applies it to decision-making.

Data governance management teams may also increase data literacy by using data analysis tools to highlight data that improves processing techniques. In the absence of clear data, data governance teams may improve decision-making by applying statistical techniques. Data governance teams should also collect and disseminate metadata associated with enterprise data warehouse content.

Another important task for the data governance team is to develop a strategic analytic plan to share with the board and management team. The team will need to set some priorities and keep them in mind to balance top-down priorities with bottom-up requests.

As corporations grow and mature through different stages of development, the data matures with them. The data governance team stands as a steward for defining data governance and encouraging departments to use it effectively. Having one responsible party for data governance matters also alleviates concerns about duplicating efforts to govern data across the organization on a piecemeal basis. Reducing duplicative efforts increases overall efficiency.

The team should also stand ready to resolve any conflicts regarding the master plan for data governance management.

Aligning Board Governance and Data Governance

Aligning board governance and data governance requires good communication between the board, management and the data governance team. The better the data governance team understands the board's strategic planning, the better the team will be able to align their objectives with it and share those objectives with members of the C-suite.

Data governance teams that work toward aligning data with corporate governance will enhance the data profile in the organization. Creating meaningful data sets will help boards and managers to make better decisions about how to allocate financial and other resources.

Data governance activities help to alleviate various risks to the organization, particularly as they relate to the integrity and risk pillars of corporate governance.

Data governance becomes a major factor in the unfortunate event of a data breach. Boards are expected to identify the location and extent of the exposed data as soon as they can. Cybersecurity is a top issue for boards. Boards will more easily be able to mitigate cyber risks and threats with the help of a diligent data governance team. This is a value that extends to shareholder expectations.

The key to a useful and healthy approach toward data governance is for the entire organization to have a good understanding of the phrase 'data as an asset.' Moving forward, best practices for data governance are likely to move in the direction of a new focus on managing data in ways that create value or generate revenue as a value-added outcome of the data governance committee.


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