CGF ARTICLES, OPINIONS & EDITORIALS
Directors balancing the assets: ISO 55000 (2015-01-29)
February 20,
2015 10203 10203 
Article by Terrance M. Booysen and reviewed by reviewed by Tom Davel (I-Pam: Principle Consultant)
Being a director of a board requires the individual to not only understand their fiduciary duties owed to the organisation, it also demands a thorough understanding of the organisation’s business, assets and operations.
Whilst the board of directors are fore mostly accountable for the organisation’s strategic direction, they also need to ensure the organisation remains compliant with numerous legislation, as well as keeping in line with its policies and procedures. As demands for sound governance in organisations has increased -- evidenced through more legislation and various corporate governance codes across the world -- so too have there been changes set by the International Standards Organisation (‘ISO’) which most organisations need to comply with. ISO develop and publish international standards; and some of the more commonly used standards are ISO 9000 (Quality Management), ISO 14000 (Environmental Management), ISO 26000 (Social Responsibility) and ISO 31000 (Risk Management).
Indeed, the previous adage that directors need
only be concerned with strategic issues is long time past. Directors need to be fully cognisant of all the organisation’s key objectives and they must be able to apply their minds to the nature of the business at both a
strategic and
operational level in order to understand (and mitigate) any risks which could negatively impact the strategy as well as the organisation’s bottom line.
One of the key areas organisations must protect is its assets. After all, this is ultimately the reason for the organisation’s existence and profitability. The more commonly known and measured physical assets include the physical property owned by the organisation, its inventory as well as its equipment as examples. But non-physical assets such as the organisation’s people, its brand and reputation, digital assets, intellectual property rights and so forth have not until recently been held at the same level of importance as the organisation’s tangible assets.
The collective value of an organisation’s
tangible and
intangible assets is critical to measure, understand and deploy. These are the critical components that make business work, which done correctly, defines the organisation’s success. For this reason a new suite of international standards has been created by the International Standards Organisation to give organisations clear guidance in asset management and best practices.
With the recently launched ISO 55001 in January 2014, as compared to its narrowly focussed predecessor -- namely PAS 55 -- it is more business-centric than asset-centric. PAS 55 is a British publication focused only on tangible assets. Due to its international nature, the ISO 5500X asset management suite -- namely ISO 55000, ISO 55001 and ISO 55002 – superseded PAS 55 in January this year.
