Corporate governance is the process of establishing guidelines, policies, controls and resolutions that promote a positive corporate culture and conduct. It also shields companies from business dangers and crises, such as cybersecurity threats, corruption in the leadership recessions in the economy, and political instability. It also has contingency plans that assist businesses in coping with these business challenges and emerge on the other side stronger and more resilient.
Corporate governance structures and procedures vary according to a company’s business, ownership structure, and the jurisdiction. These governance structures and practices, despite their differences must all share the same objective: to create long-term value for shareholders. They must also be flexible enough to adjust their governance practices to meet this goal.
The company’s board of directors is responsible for setting strategic goals, appointing and overseeing senior management, and representing the interests of shareholders. Board members must understand their responsibilities, and work with senior management to meet them in a manner that aids the growth of the business and financial performance.
Stakeholders should be encouraged to engage in dialogue and engagement with the board http://scoreboardroom.com/steps-to-create-a-nonprofit-social-media-policy/ of directors and management. This will enable them to make their views known in areas that, traditionally, fall within the control of the board and management–such as strategic direction and decision-making. It is crucial that the board and management are honest and open about their governance structures and practices, and the reasons for using them.