The Principles
The five Principles focus on the areas of leadership and governance that influence how an SME operates, makes decisions, develops its people and prepares for the future.
They are designed to be applied proportionately. What is appropriate for a micro business will not necessarily be appropriate for a medium-sized business, but the underlying Principles remain relevant as the organisation grows.
Purpose, Stakeholder Value & Impact
Understanding what the business stands for, who it affects and how today's decisions create long-term value.
This Principle considers how purpose influences the way a business operates and makes decisions, alongside its responsibilities to employees, clients, suppliers, communities and other stakeholders.
It encourages SMEs to look beyond immediate commercial outcomes and consider the relationships, reputation and wider impact that contribute to the long-term strength of the business.
Leadership Safety & Culture
Understanding how leadership behaviour shapes the culture people experience every day.
This Principle focuses on the behaviours demonstrated by those leading the business and the environment those behaviours create for others.
It considers whether people can contribute, challenge and raise concerns safely, whether expectations apply consistently across the organisation, and how leadership behaviour influences trust, performance, retention and reputation.
Workforce, Progression & Fair Opportunity
Understanding how people enter, develop and progress through the business, and whether opportunity is distributed fairly.
This Principle looks at the decisions SMEs make about recruitment, pay, development, progression and leadership opportunity.
It encourages businesses to understand their workforce, recognise patterns and develop talent more deliberately, helping ensure important people decisions are fair, consistent and capable of explanation.
Accountability, Risk & Oversight
Understanding who is responsible, where the significant risks sit and whether leaders have the information they need to protect the business.
This Principle considers how responsibility and authority are understood across the organisation, how material risks are identified and managed, and how leaders maintain appropriate oversight of performance and obligations.
As the business becomes more complex, it helps ensure that accountability, information and oversight develop with it, without introducing unnecessary bureaucracy or slowing down the agility that makes SMEs successful.