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Corporate Governance

Corporate Governance

Corporate Governance

Corporate governance is a set of guidelines that help in the successful running of a company. These guidelines are to be verified and checked periodically by the Board of Directors. Every organization requires some kind of corporate governance to have a sound functioning of the system. Particular emphasis is laid on three groups, which includes the shareholders, Board of Directors and management.

Aspects of Corporate Governance

Corporate Governance must uphold the rights & equality of shareholders and must fix their responsibilities and relationships with other stakeholders. It must monitor the Boards’ qualification, efficiency, and quality to improve corporate governance in an organization which promotes business as well as fitness for the organization. Integrity is the key factor in its success, it is a fundamental requirement and it should develop a code of ethics. The company must operate full disclosure to its stakeholders creating a provision for stakeholders accountability.

The Need for Good Governance

Bad corporate governance can troupe distrust on a company’s dependability, honesty or responsibility to its shareholders which can result in insinuations on the company’s financial health. Companies that do not liaise adequately with assessors or do not hire assessors with the suitable scale can issue bogus or uncooperative financial outcomes.

Good corporate governance promotes transparency among stockholders, boards, and officers. Most companies make a tremendous effort towards corporate governance. For many stakeholders, it is not sufficient for a company to just be lucrative; it also needs to exhibit good corporate placement through environmental cognizance, moral conduct, and sound practices.

Benefits of Corporate Governance


A corporate governance suite would enhance a company’s status if policies and their applicability were publicized. Additional shareholders would be ready to work with such an organization. The exercise of sharing core data with key stakeholders lets people feel more self-assured. This consists of creditors who possess robust financial strategies and internal controls. A company could partner with service partners to encourage business, government agencies, employees, the media, vendors, and suppliers.

Effective Risk Management

A company must install strategic risk management policies to avoid the risk of competitors stealing ideas. Proper emphasis must be laid on transparency in governance and management, as its working affects the total culture. There must be discipline and commitment towards implementing strategies, solutions and risk assessment.


Fair-mindedness must be the highest priority for a management. Companies must always remember to treat their customers with due diligence. For example, if a manager drives his subordinates to perform more to deliver great results, he must identify if the workload is heavier for them to handle. This might portray a negative effect, hence, we must be fair to our customers by identifying their concerns.

Social responsibility

A good organization must be responsible towards the social and environmental aspects and encourage its workforce to participate in social causes and identify ways to help the cause of the society they live in.


Mistakes are made no matter how hard and stringent the policies of corporate governance might be. We must be receptive to feedback and healthy criticisms.