Corporate Governance Sample

Corporate Governance Sample
Home Page 1 of 11 Private Sector Corporate Governance Trust Home Events About Us Principles & Sample Code Global Initiatives Board
Principles of Good Corporate Governance Sample Code for Best Practice for Corporate Governance in Kenya SAMPLE CODE OF BEST
PRACTICE FOR CORPORATE GOVERNANCE IN KENYA (This sample Code is intended to assist companies develop their own governance codes
and is neither prescriptive nor mandatory) Authority and Duties of Shareholders Shareholders of the company shall jointly and severally protect,
preserve and actively exercise the supreme authority of the company in general meetings. They have a duty, jointly and severally, to exercise that
supreme authority to: в™¦ Ensure that only competent and...show more content...
в™¦ Structure and organize the company. http://www.corporategovernance.co.ke/principles/Sample%20Code.htm 09/10/2002 Home Page 3 of 11 в™¦
Monitor management performance. в™¦ Map out the mechanisms for internal and external liaison and communications. в™¦ Define how the Board
will operate including: What information or reports it requires on a monthly or quarterly basis. How, with what data, and by what means, it will
constantly monitor management performance and the financial progress of the company. How it will evaluate its own performance at least once every
year. в™¦ Ensure that the company is properly managed and for the attainment of lawful objectives. в™¦ Ensure that the company's affairs are not
managed or conducted in a manner oppressive to any of its shareholders or for fraudulent purposes. в™¦ Ensure that the company complies with all
statutory requirements. Composition of the Board The Board shall include a balance of executive and non–executive directors (including independent
non–executive directors) such that no individual or group of individuals or interests can dominate its decision taking. The Board shall be chaired by
an independent director who is not managing the company. There are two key tasks at the top of the company, that of running the Board and that of
the Chief Executive responsible for running the company. Therefore as a general rule, there is a clear division of these roles to ensure that a balance
of power and authority is
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Chapter–1 Introduction to Corporate Governance 1.1 Introduction Corporate Governance is a buzz word in the business world. It is envisioned to
enhance the accountability of a concern and to evade huge disasters before they occur. The concept of corporate governance dived to global attention
after the sudden crashes of Enron, World Com, Xerox, Lehman Brothers, Parmalat, Satyam etc. The failure of these colossal business houses horrified
the corporate world with their unethical and unlawful operations which affected the employment, finances of national and local government worldwide
and international economy. The history of these scandals have forced all the corporates to have substantial and clear record of wealth creation and
transparency over a period of time. Integration and globalization of financial markets and a gush of corporate scams have led to the fast developments
within the field. With the continuous growth in the foreign investments in India, the international investors would assert that the corporations in which
they have interest should follow a "Code of Corporate Governance". In such a scenario, Indian corporates cannot afford to disregard the best
corporate governance practices since India is a developing country. Corporate Governance has, of course been a highly debated field of enquiry with in
the finance discipline for decades. Several studies emanating from academic and non–academic circles over the years demonstrate that better corporate

Essay On Corporate Governance
Corporate governance has played a very important role in the present economic condition of India. India successfully started its move towards open
and welcoming economy in 1991. From then onwards it has seen an amazing upward trend in the size of its stock market, that is, number of listed
firms was increasing proportionately. If India wants to attract more countries for foreign direct investments, Indian companies have to be more focused
on transparency and Shareholders value maximization. Even though corporate governance practices can be backdated to as early as 1961 around the
world, India was lagging behind. It was not until 1991 when liberalization took place and corporate governance established an international context. The
most...show more content...
We can compare the Sarbanes–Oxley Act of 2002 and Clause 49. Clause 49 was based on the principles of Sarbanes–Oxley Act of 2002. It was
developed for the companies listed on the US stock exchanges. As far as the responsibilities of management and number of directors were concerned,
they are both the same. They also have same rules regarding insider trading, refusal of loans to directors and so on. The important difference between
the two is under Sarbanes–Oxley legislation if fraud or annihilation of reports takes place up to 20 years of imprisonment can be charged, but in case
of Clause 49, there is no such condition. Being the controller of the market SEBI can commence a criminal proceeding. If in case SEBI decides to give
a severe punishment then it can commence a criminal proceeding or raise the fine for not agreeing with Clause 49, which automatically delists the
company.
Corporate governance affects corporations as well as countries in different ways such as firms access to outside financing increases, which leads to
more investment, better growth opportunities and that causes the job market to flourish. Capital cost is decreased and so the firms are valued at higher
cost. Firms can be attracted by this, which directs it to growth and again to reduced unemployment. Wealth is generated by better distribution of
resources and good management practices, which is because of better operational performance.

Corporate Governance Essay
Corporate governance is an increasingly important topic in this age of globalisation, it is a global occurrence which in turn makes the subject
complex, with issues of ownership, cultural, legal and other structural differences being involved. From this broad scope, it is discernible that the
functions of the board are inseparable from the topic of corporate governance and in turn what effect these have and will potentially have on the share
price in the future. As with every other aspect of globalisation, its development is not necessarily even across all spheres; "thus some theories may be
more appropriate and relevant to some countries than others..." (Mallin 2010, p. 13). In making any assertions on the impact of corporate...show more
content...
In recent times, the assumption that shareholders will be willing to pay a premium for such shares that are identified as having favourable governance
scores is sounding more reasonable due to growing research and reports on the effect of corporate governance on equity value. "Their results clearly
support the hypothesis that well–governed companies outperform their poorly governed counterparts. Well–governed companies have higher equity
returns, are valued higher and their accounting statements show a better operating performance" (Bauer, Gunster & Otten 2003, p.2) There have been
surveys into different companies in the United States and across Europe with the aim of comparing the performance of poorly managed firm against
well run ones, the relationship between varying governance standards and the return on shares across FTSE Eurotop 300 showed that across the EU,
there was a more visible relationship between governance and firm value, this was attributed to the relatively poorer governance standards available in
the which meant that excess returns to corporate governance were much smaller when compared to the UK where corporate governance standards are
generally higher.( Bauer, Gunster & Otten ibid p.15) Similarly, further research to establish an empirical relationship between corporate governance and
share value looked into

The scandals at Enron, Global Crossing, Tyco International and WorldCom initiated a fierce dispute over corporate governance practices and
executives' ethical behaviours. Since then, both academicians and practitioners tried to found the most suitable corporate governance framework that
would enhance the companies' value and would benefit the society as a whole. The difficulties of several apparently prior successful banks (such as
Anglo Irish Bank, Northern Rock and Royal Bank of Scotland (RBS)) during the financial crisis reminded us that this dispute is far from over. This
paper examines the two main theories that govern the corporate governance principles and looks at which one of them leads to greater company
performance: shareholder theory (Agency theory) or the stakeholder theory? There are many definitions of company performance, both financial and
nonfinancial. This analysis assumes increasing share value and therefore the market value as a company performance appraisal tool. Finally, the
theories are examined from the ethical point of view and its impact on the firms' shares worth. What evidence is there to show that 'good' corporate
governance can improve firm performance? Good corporate governance is a vital tool in enhancing market trust and promoting more secure, long–term
investments. Shleifer and Vishny (1997) describe corporate governance as a mechanism that addresses the conducts in which lenders to companies
guarantee themselves of receiving a

Corporate governance is a model in which processes and relations by which corporations are controlled and directed. It can also be defined as a system
of laws and authoritative approaches by which corporations are directed and controlled. This is achieved by considering the internal and external
structures of the corporations. The intentions include monitoring actions of management and directors to moderate agency risks, which may be rooted
in the misdeeds of corporate officers. This ensures that these risks and conflicts are prevented and moderated using policies, laws, customs, processes,
and institutions that have great impacts on the way a corporation is controlled. This corporate governance has great impacts on firm performance,
...show more content...
This was evident in the UK Guinness case where chief executive Earnest Saunders paid himself ВЈ3 million without the consent of any other directors
(Nini, Smith & Sufi, 2012).
There are other problems faced when several people dominate the corporation, as there may be problems in the composition of the different directors.
This may be run by minority group of CFO or CEO, who may undertake recruitments and appointments by personal interests, but rather not on the
formal procedure, which should be undertaken. Thus, corporate governance should ensure a balance of talents, skills and competence from the
numerous specialism's related to the organizations ' situation and age. This is meant to facilitate new people in assisting the planning processes.
Remuneration and reward of directors is another target that corporate governance aimed. This was to reduce the excessive bonuses and salaries that
directors used to receive. This was undertaken as they believed it was a corporate abuse where such amount of salaries could be offered to other
projects and expansions within the corporation (Masulis, Wang & Xie, 2012). Financial reporters and external auditors were reliable of the financial
accountabilities of their reports. This ensured that serious litigation would be undertaken in cases of insufficient reporting and accounting issues. This
led to great transparency in firms and reduced risks faced by investors (Masulis,

The corporate governance framework is there to encourage the efficient use of resources and equally to require accountability for the stewardship of
those resources. In the context of public service or private sector organization, Good Corporate Governance is therefore about ensuring all stakeholders'
adherence to organizational policies, procedures and systems.
The right to health has been recognized ever since the birth of the United Nations (UN) in 1945. The Charter of the UN urges state parties to respect
rights to a higher standard of living and solutions to international health problems. On 7 April 1948 the World Health Organizationwas founded as the
custodian of the world policies on health matters. It has 194 Member States of...show more content...
However, it is recognized that there is still a lot of ill health that is related to diseases of poverty and ignorance. Of the six WHO regions in the world,
the African Region bears the heaviest burden of disease (WHO, 2000). Effective and efficient implementation of national and local policies can reverse
this trend. Indeed, the world press (2008) opined that a critical challenge for countries in Africa is to move from policy to action in the health service
delivery. This move from policy to action should be grounded on each country addressing its priority health needs and mobilizing its people to improve
the state of health service delivery at personal and community levels.
According to a World Bank report, Sri Lanka has achieved a remarkable health service delivery as a result of devolution (World Bank 2010). This has
been attributed to successful implementation of a credible budget constraint for the hospital; reform to strengthen the accountability of managers for
the performance of the hospital through the creation of a board of external directors or trustees, or a hospital authority to supervise the manager; and
increased managerial authority with freedom to recruit, promote, set tasks and work hours, and decide on performance rewards and sanctions. Further,
Sub–Saharan Africa countries, in translating existing policies into national plans of action, should also

Corporate Governance Essay
Corporate Governance
Corporate Governance is the relationship between the shareholders, directors, and management of a company, as defined by the corporate character,
bylaws, formal policies and rule laws. The corporate governance system was designed to help oversee the decisions and best interest of the shareholders
. The system should works accordingly: The shareholders elect directors, who in turn hire management to make the daily executive decisions on the
owner's behalf. The company's board of director's position is to oversee management and ensure that the shareholders interest is being served.
Corporate governance focus is with promoting enterprise, to improve efficiency, and to address disputes of interest which can force upon...show more
content...
Boardrooms are changing. Directors can no longer be passive. They must be alert, accountable and active. The board's performance has come under
more scrutiny. Shareholders, members and staff expect more from their boards.
Individual directors of the corporate governance board should possess all of the
following characteristics:
Integrity and Accountability
Informed Judgment
Financial Literacy
Mature Confidence
High Performance
Passion
The board as a whole should possess the following core competencies, with each
member contributing knowledge, experience and skills in one or more domains.
Accounting and Finance

Business Judgment
Management
Crisis Response
Industry Knowledge
International Markets
Strategy & Vision
Companies are becoming more involved with corporate governance and they are following more strict rules and guidelines. One major problem is
how board members are being elected. Avoid employees for the company seems to be one way to eliminate poor corporate governance committees.
They have to try to keep the chief executive officers from loading the board with friendly directors that are close to them. The most difficult change
will be electing board members. A major

This was adhered to by a comparable code by the Central Bank of Nigeria in 2000 (CBN, 2006) to deal with corporate governance practices in
Nigerian financial institutions. Nevertheless, lessons from the corporate collapses and also losses in the last couple of years with respect relative to
banks like Intercontinental Bank Plc, Bank PHB Plc, Societe General Bank, Afri–Bank Plc as well as Oceanic Bank Plc have actually highlighted the
function, corporate governance techniques could play in keeping viable organizations and in protecting stakeholders rate of interests. The majority of
the business failings that were recorded in the Nigerian banking are instances of the dangers positioned by corporate governance failures.
In July 2015, the...show more content...
Panel data methodology was adopted because it combined time series and sectional data. The method of analysis is multiple regressions, ratios and
percentage analysis.
Elements of the external business environment:
Business Environment
Financial Institutions in Nigeria operate in a highly competitive environment and their key internal strengths and weaknesses are being examined in the
context of its industry. A SWOT analysis which summarizes the key issues from the business environment and the strategic capability of an
organization that is most likely to impact on strategy development (Johnson, Scholes, and Whittington 2008) will be used to add value to the subject
matter.
PESTLE Analysis will be used in order to identify the strengths and weaknesses of Financial Institutions and the available threats and opportunities in
the competitive market, while taking into consideration various political, economic, social, technological, legal and environmental factors.
Strengths
Since the recapitalization of the banking sector in 2004 to a minimum of 25 billion Naira, the institution of the Central Bank of Nigeria Code of
corporate governance 2000 (2006) and diverse routine gazetted money market guidelines of the Central bank of Nigeria have enhanced the deposit
and credit turnover of banks by an average annual increase of 13%. Average annual net assets have also increased by 35% and average annual
earnings per share increased by

Strengths And Weaknesses Of Corporate Governance
A)Corporate Governance is a structure of the company by balancing all the individual, corporation and society interest. It also helps to create
relationship between company board, shareholder and stakeholder and have proper functioning of organization to prevent fraud. Board of director in
the company is being appointed by the shareholder and was been audit by them if the director managing and operating the business well by reporting
or having general meeting. The responsible of the board of director are achieving the company objective, provide leadership and supervising the
management and reporting the shareholder about the achievement and problem. All action of the board are subject to laws, regulations and shareholder.
There are various theories that underline the development of corporate governance which include Agency theory, Stakeholder theory, Stewardship
theory, etc.
According to (Jill Solomon, 2013), agency theory is "defined the managers of the company as the 'agents' and the shareholder as the 'principal' ".
Which mean that principal hire & assign the decision making and operating to the agent by the their own interest. However in agency theory, most
...show more content...
In case of Walt Disney, the decision made by Eisner, it does not provide any risk reporting to shareholder, whereby it does not seek agreement of the
shareholder that the action made if it is for the best interest of the shareholder or Eisner himself. It recommended to encourage accountability by
having a proper risk management controls and strategy. It will help the organization achieving of growth by having a proper planning and evaluation
of risk of the impact to have a correct action with agreement of everyone and monitoring all the task regardless of large or small that is delegated. This
will help the company to have appropriate system of internal control and increase of accountability within the

Title: Corporate Governance Assignment topic Option 1 Conduct a review of the governance of your organisation (or one with which you are familiar)
in the form of a report to the Chairman (or President) of the Governing Board of Directors. In the brief report use the concepts, tools and techniques
learned in this subject to review the structure, process and effectiveness of the governance of the organisation and make recommendations for
appropriate improvements. Executive summary This report sets out to review corporate governance at a private company, namely, Paramount
Insurance Company. The specific objectives were to identify the relevant codes the organisation follows, why they are important and review the
structure, process and...show more content...
For the purpose of this report, corporate governance is defined as the relationship that exists between company management, stakeholders and the
board. Objectives of the company are usually set, attained and monitored through the structure corporate governance provides. (Balgobin 2008).The
Guyana Corporate Code of Governance is similar to the UK codes of corporate governance and the Organisation for Economic Co–operation and
Development (OECD 2004).These principles serve as a reference point that can be used by companies to develop their own frameworks for corporate
governance that reflect their own circumstances or situations. Composition and criteria at Paramount The Chairman and the Chief Executive Officer
There is extensive research on board composition and the importance it places on different aspects of organisation performance. (Kang H, et al 2007).
At Paramount the unitary board exists, where according to the textbook, a unitary board is when a company has a single governing body (Tricker
2009). A non– executive director is defined as a person who is not involved in the day to day management of an organisation but rather in business
tasks such as strategic planning, and monitoring of executive directors. An executive director tends to be more involved in the managerial aspects of
the company. The Chairman and four other directors are independent non–executives, and the CEO and one director are non– executives. Diversity of
board

Essay on Corporate Governance
Corporate Governance " Corporate governance – ten years ago the phrase was not used, today it is commonplace. The work of company directors is in
the spotlight. The issues are legion: How to improve corporate performance and strategies, how to ensure corporate conformance through executive
supervision and accountability, the role of outside directors, audit committees, chairman and CEO, directors' remuneration, German two–tier boards,
Japanese boards, institutional, investor powerГўв‚¬В¦.. " (Corporate Governance, Bob Tricker, 1984) The term 'corporate governance', in recent years
has been used in a number or contexts, particularly in relation to that of boards of companies listed on the...show more content...
But many countries regard a better corporate governance practices as a way to improve economic dynamism and therefore enhance overall economic
performance. Corporate governance issues probably came to the fore in the early 1980's in the United States during the heyday of the corporate
take–over activity. Perceiving little support from their institutional shareholders, numerous US Company boards started to initiate protective practices
to deter any undesirable take–over bids. While occasionally effective in their primary goal, these measures were seen by some shareholders, especially
public pension funds, as acting against their best interests. Subsequently, these shareholders began to take a greater interest in their investments. Legal
commitments forced upon US corporate pension funds to 'manage their assets' hastened this process. Out of this, Corporate governance was inevitably
born. Corporate governance is set in the framework and attitudes of political and social history in the UK. The nineteenth century in the UK saw mostly
sole–traders and partnerships emerging, with the directors usually the owners and management, thus with limited liability. This brought about a
disincentive to expand. But the Acts passed in 1855 and 1862 encouraged these businesses

What is Corporate Governance Essays
Fraudulent Actions
What is corporate governance?
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 fulfil 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 . This definition seemed more appealing as it gave a broader understanding than the other offered
definitions. It explains in plain simple terms what exactly corporate governance is and who it involves. Other definitions were vague and didn't
mention some of the participants involved. Corporate governance is a process and a system, and as with any...show more content...
The original section 297 legislation contained a double test which was subjective and difficult to prove, as the perpetrator had to be knowingly part of
the fraud and also must have had intent to commit the fraud. If a particular person concerned genuinely believed that they had not acted fraudulently,
then they would not be regarded as trading fraudulently. This was despite the fact that their behaviour might be considered unreasonable looking at it
objectively. Only three cases were successful in Ireland under the original s.297.
The first successful case was Re Kelly's Carpetdrome Ltd 1983, where books of the accounts were destroyed, and valuable assets were transferred to
connected companies to avoid sale on liquidation. This was the first case on s.297 fraudulent trading and personal liability was imposed.
The next case was Re Aluminium Fabricators Ltd 1984. The company had two sets of books, one for the management and one for the revenue. Also,
the managers through this deceit were taking

The Corporate Governance Of Walmart
Walmart is considered as the biggest retailer in United State and opening widely to over the world recently. The priority condition for its success
firstly is come from the outstanding players of the corporate governance such as Board of directors and Activist Shareholders. These all creative and
responsible leaders are required to possess ability for risk–taking willingness and control in order to govern company. In addition, the activist
shareholders actively raise their voice in the policies and strategies' approval. All in all, the excellent corporate governance they made ensures an
accountable and integrity system operated. Board of Directors First of all, in Walmart, the Board of director is the most powerful governing
authority who are responsible for setting the framework and management structure in general. It is committed to be operated in fairness and integrity
in order to ensure the shareholders' trust. Board of directors' internal duty is to control mechanisms for good governance are adequate. This includes
setting up legal existence, establishes company's vision, key mission, strategic direction, selecting and appointing chief executives, governing the
organization via policies and objectives to guide other agencies following up. All strategic decisions of the corporation would be raised and agreed
by the board, such as hiring a CEO, approving to do a major financing or acquisition. Its primary responsibility is protecting shareholders' asset as well
as

ITC Ltd.'s strategy plan for compliance with the current acceptable standards or norms relative to social responsibility today is well thought out,
especially for a company that sells potentially dangerous products, and try to meet and listen to all demands and laws in place since the start of
their business. Even though in 2014 a new bill was passed for the majority of companies to build accountability and also have the government
looking over the private sector (Banerjee, 2013). "The CSR provision requires affected companies to spend at least 2 percent of their average net
profits made in the preceding three years on CSR" (Banerjee, 2013). Even though this bill has caused a lot of uproar for companies, ITC has actually
already been...show more content...
This helps the company stay on track and be prepared for new laws that require companies to invest in CSR. ITC is also a company that makes sure
they are taking initiative and being sustainable. The company has managed to be water positive and a carbon positive company (Ojha, n.d.). The
company has also been able to "reach... animal husbandry services, education services, and self–help services as part of the efforts of the company to
live up to the promise emphasized in its vision" (Ojha, n.d.). Their environmental initiatives are extremely developed and their social initiatives, such
as forestry, farms, education of farmers and kids are also nicely developed (Ojha, n.d.). This company's corporate positioning statement says it all:
"Enduring Value. For the Nation. For the Shareholders" (Ojha, n.d.). ITC takes the time to think and plan in order for compliance with current
acceptable standards or norms relative to social responsibility. The organization's strategy plan for any gaps in social responsibility that might be
potential risks to internal and external stakeholders is challenging, but this company certainly does not allow for corruption. On April 1 "India has
become the only country in the world with legislated corporate social responsibility (CSR) and a spending threshold of up to $2.5 billion (Rs 15,000

Corporate Governance and Ethics Essay
As a CEO of a corporation there is nothing more rewarding then maximizing the wealth of your shareholders, in addition, to increasing the value of
the firm. However, it should not be done unethically and jeopardize the financial, social status as well as the reputation of the company, ultimately
causing them to suffer in the end. There are systems put into place to avoid such acts that are generally overseen by the board of the directors of
organization. In most companies the board of directors consists of shareholders or former employees of the company. Due to the recent scandals in
corporate America many companies have acted quickly in actually implementing rules and regulations. They are sometimes referred to as the ethical
codes....show more content...
Women are known to be a bit more "sensitive" than a man, therefore she' more opted to working or dealing with charitable events due to their dire
need of help. I am not implying that companies headed by women are more or least successful than one headed by a man. I am simply implying that
they will do better in the "social responsibility aspects of the big picture.
Ethical codes are normally adopted by corporation to help set forth the moral structure of a company. They are often set up to help organizations to
make the "right" decision in certain situations. Ethical codes generally has three different levels (Wikipedia, 2011), code ofethics (corporate and
business ethics), code of conduct (employee ethics), and code of practice (professional ethics). Code of ethics is defined as the general principals of an
organization that summarizes their beliefs (QFinance – The Ultimate Resource, 2009). Rodriquez–Dominquez, Gallego–Alvarez, and Garcia–Sanchez
(2009) state "recent corporate scandals have demonstrated the need to create internal codes of conduct and apply them to the members of the board of
directors and top management in order to uphold the reputation, ethical behavior and integrity of the company". (p.187) According to
(Rodriquez–Dominquez, 2009), recent research has shown a positive correlation "between corporate social responsibility and several characteristics of
corporate governance". The results also show

corporate governance Essay
Corporate governance is a very poorly defined concept; it covers so many different economic issues. It is difficult to give a first class definition in
one sentence. Corporate governance has succeeded in attracting a great deal of interests of the public because of its obvious importance for the
economic health of corporations and society in general. As a result, different people have come up with different definitions that basically mirror their
special interest in the field. It is difficult to see that this 'disorder' will be any different in the future so the best way to define the concept is perhaps to
list a few of the different definitions rather than just mentioning one definition.
"Corporate governance is a field in economics...show more content...
Critics often proclaim that boards fall sadly in this category and are simply assistants to their chief executive officers (CEOs). They get paid too much,
work entirely too little, and have little expertise in corporate governance or possess unacceptable levels of financial literacy.
(Booker, 113–116)
Governance reform has been a hot topic of discussion since the 1980s, when firms in America faced increased globalization and change, and boards
were scrutinized for being puppets of the chief executives. Supporters of reform called for larger independence of directors from the CEO so that the
board could make the difficult decisions needed to monitor top management and protect shareholder interests. Before the 1980s, most boards were
composed largely of directors who were currently employed by the company of had just retired from the company. Critics proclaimed that directors
who "were selected by, reported to, and received paychecks from the CEO could hardly be the most objective management monitors." As a result of
these complaints, many boards made changes so that most large company boards are composed of a majority of directors that "are not currently
employed by, or retired from, the companies on whose boards the serve."
With these changes, however, came the understanding that even

CORPORATE GOVERNANCE Essay
CORPORATE GOVERNANCE
The Oxford English Dictionary defines 'governance' as 'the act, manner, fact or function of governing, sway, control'. 'To govern' is 'to rule with
authority', 'to exercise the function of government', 'to sway, rule, influence, regulate, determine', 'to conduct oneself in some way; curb, bridle (one's
passions, oneself)', or 'to constitute a law for'.
Governing is, therefore, a whole range of actions, initiatives and response patterns – from rule through influence to self–control and self–regulation. By
inference it includes 'driving' as well as 'steering'. Therefore, in seeking to define governance and the purpose it is to acheive, it is necessary to give
adequate consideration to its antitheses – 'freedom' and...show more content...
Thus Governance involves monitoring and overseeing strategic direction, socioeconomic and cultural contexts, externalities and constituencies of the
institution.
Thus, the primary goal of governance is making sure the right questions get asked at the right time, at the right place, 'by' the right persons, 'to' the right
persons and in the right manner. It is not a coincidence that the worst corporate performers are the ones that had once been so securely on top that they
stopped asking questions.
Governance is usually delivered through an agreed constitution, through a complex web of customs and practices, underpinned by a shared system of
ethics, to a range of stakeholders from the shareholder to the customer in that institution. Styles of governance vary depending on the nature and size of
the body concerned. At one extreme is the rule–based style adopted by public sector bodies, which may be concerned with conformity rather than
performance. At the other extreme are the churches and clubs where governance is based on trust. Most corporate bodies have an amalgam of both
trust and rules in appropriate proportions. The Logic being that trust can only work with open governance.
The basic prerequisite to achieving successful and effective governance is the establishment of certain criteria for systematic governance. As a
minimum these are likely to

A Summary On Corporate Governance
Like de Kluyver argued in his publish (A primer on Corporate Governance, 2009), "there is a presumption that, in making a business decision, the
directors acted on an informed basis, in good faith, and in the honest belief that the action was taken in the best interest of the corporation." However,
even though the bar has been set, the definition of "best interest of the corporation" is open for every business directors to interpret. In the case of Enron
, the rule had been bent so hard that it finally broke. The company was originally established as an energy provider in the US. In 1970s, the CEO of
Enron seized the chance of US energy market deregulation and navigated the company into a new and attractive business – energy trading....show more
content...
Because of the massive company structure, when the bubble broke in 2001, a numerous amount of people took the hit. The stockholders of Enron
scandal include company employees, board of directors, Arthur Anderson accounting firm, Vinson & Elkins law firm, and the general public of the
society.
There were specific internal control protocols and external audit agreements designed to prevent the tragic from happening. However, just like my
classmate Likhita said during the class discussion (Thought and Discourse, September 16, 2015), "People will always find the loophole". In terms of
internal control failing, first of all, the malfunction of the board of directors would be our primary concern. Enron Board of Directors clearly failed to
oversight company operations. In United States Senate Subcommittee report (The role of the board of the directors in Enron's collapse, Permanent
subcommittee on investigations, 2002), committee memebrs indicated that "The Board witnessed numerous indications of questionable practices by
Enron management over several years, but chose to ignore them to the detriment of Enron shareholders, employees and business associates."
Moreover, the Board of Directors directly violated Enron's code of ethics and agreed the company from trading with several SPE (includes LJM1) run
by its own CFO, Andrew Fastow. Such transactions were not designed to generate legit business profit, nor providing

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Corporate Governance Sample