Corporate Governance Principles

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 is highlighted on corporate governance is the need for those in control to be able to distinguish between what are personal and corporate funds while managing a company .

Fundamentally , there is a level of confidence that is associated with a 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 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 centre of discussion only after the exposure of a large scam .

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