Corporate Governance Overview



hello questions master I am setting the corporate strategy and I would like to know what is corporate governance hello Laura corporate governance refers to the set of systems principles and processes by which a company is governed they provide the guidelines as to how the company can be directed or controlled such that it can fulfill its goals and objectives in a manner that adds to the value of the company and is also beneficial for all stakeholders in the long term stakeholders in this case would include everyone ranging from the Board of Directors management shareholders to customers employees and society the management of the company hence assumes the role of a trustee for all the others what are the principles underlying corporate governance corporate governance is based on principles such as conducting the business with all integrity and fairness being transparent with regard to all transactions making all the necessary disclosures and decisions complying with all the laws of the land accountability and responsibility towards the stakeholders and commitment to conducting business in an ethical manner another point which matters is the need for those in control to be able to distinguish between what are personal and corporate funds while managing a company why is corporate governance important fundamentally there is a level of confidence letters associated with the company that is known to have good corporate governance the presence of an active group of independent directors on the board contributes a great deal towards ensuring confidence in the market corporate governance is known to be one of the criteria that foreign institutional investors are increasingly in depending on when deciding on which companies to invest in it is also known to have a positive influence on the share price of the company having a clean image on the corporate governance front could also make it easier for companies to source capital at more reasonable costs unfortunately corporate governance often becomes the center of discussion only after the exposure of large scans why should the public be interested in corporate governance there has been renewed interest in the corporate governance this is a modern corporation since 2001 particularly due to the high-profile collapses of a number of large corporations most of which involved accounting fraud corporate scandals of various forms have maintained public and political interest in the regulation of corporate governance in the u.s. these including run Corporation and Mac I incorporated formerly world cam their demise is associated with the US federal government passing the sarbanes-oxley act in 2002 intending to restore public confidence in corporate governance similar corporate failures in other countries stimulated increased regulatory interest our corporate management and corporate governance different governance has little to do with management and this often comes as a surprise to directors it is not a hands-on activity that can be learned then put into action easily it is a whole board activity and not something that can be delegated to the company secretary or the chair personal only whilst management operates within a hierarchy of delegated responsibility and authority the members of a board are all jointly and individually responsible with equal rights and duties the practice of governing is certainly different from managing it is not about managing companies but ensuring they are well-run it is less about doing and taking action than reflecting and learning the key principles are that of prudence acting in good faith stewardship Duty openness transparency and integrity these are the real building blocks of excellence in corporate governance and the binding actions for an effective board so if management is about running the business corporate governance is about seeing that it is run properly all companies need managing and governing is this right absolutely what is the relationship between management governance and strategy this is a question Northwood Zumba group will have to answer thank you questions master you're welcome Laura now class that you know what corporate governance is what other important issues should I look at to understand the corporate governance as role in the strategic decision-making in each corporation

Maurice Vega

11 Responses

  1. I was forced to spend 4.28 minutes of my life to watch this in order to complete my FM E-Learning Assignment (Y)

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