Good corporate governance is essential in order for cannabis companies to weather the extreme volatility surrounding cannabis stocks in the capital markets. As the cannabis industry experience explosive growth and the investor base morphs from retail to institutional, the pressure to have proper governance infrastructure in place will intensify. Institutional investors demand independence, transparency, and accountability from Boards and at times take action to bring such demands to fruition. Having a proper governance structure in place helps to ward off disruptions by activist investors. The winners in the cannabis industry will be those that are able to put systems and processes in place that garner the support and confidence of both retail and institutional investors.
Shelley Albert, Director, AG Governance Consultants