The term corporate governance encompasses the structures, customs, policies and procedures that govern the way people manage, direct and www.boardroomdirect.blog/what-are-the-four-types-of-corporate-governance oversee a business. This involves developing a long-term vision of business, recording the processes that support it, and regularly reviewing the performance. Good corporate governance is founded on the principles of transparency and accountability.
It is required that organizations provide all relevant information, including financial results, meeting outcomes, minutes, changes in normal operations or the resignation and replacement of key board members and managers. This encourages honesty, integrity and a willingness to to share both good and bad news with employees, shareholders, vendors and the community.
Generally, the role of the board of directors of a company is to establish a system of checks and balances to ensure shareholders are treated fairly and that decisions made by management are sound. This also includes overseeing the effectiveness of internal controls to ensure compliance with laws and regulations.
Around the world, different models of corporate governance are in use. The most popular is the Anglo-American model that places the interests of shareholders first in decision-making and management. This model is widely used by companies in a variety countries however other governance models exist. Although they differ, all have some similarities and all share the same core principles.