Chapter 1
INTRODUCTION TO CORPORATE GOVERNANCE
GOVERNANCE – a process whereby elements in society wield power, authority,
and influence, and enact policies and decisions concerning public life and social
upliftment - process of decision-making and the process by which decisions are
implemented (or not implemented) through the exercise of power or authority by leaders
of the country and/or organizations
MAJOR CHARACTERISTICS OF GOOD GOVERNANCE
1. Consensus Oriented – best interest of the whole community; broad and long-
term perspective on what is needed for sustainable human development
2. Law – impartial enforcement of legal frameworks; full protection of human rights
3. Equity and Inclusiveness – opportunities for everyone
4. Accountability – to everyone who may be affected by its decisions or actions
5. Responsiveness – serving the needs of all stakeholders within a
reasonable timeframe
6. Participation – informed and organized; freedom of association and expression
7. Effectiveness and Efficiency – meeting the needs of the society and making
the best use of resources
8. Transparency – freely available and directly accessible information;
enough information in easily understandable forms and media
Efficiency – doing things right
Effectiveness – doing the right things
CORPORATE GOVERNANCE – system of rules, practices, and processes by
which business corporations are directed and controlled
Greatly contributes to financial market stability and economic growth
PURPOSES:
INTRODUCTION TO CORPORATE GOVERNANCE
GOVERNANCE – a process whereby elements in society wield power, authority,
and influence, and enact policies and decisions concerning public life and social
upliftment - process of decision-making and the process by which decisions are
implemented (or not implemented) through the exercise of power or authority by leaders
of the country and/or organizations
MAJOR CHARACTERISTICS OF GOOD GOVERNANCE
1. Consensus Oriented – best interest of the whole community; broad and long-
term perspective on what is needed for sustainable human development
2. Law – impartial enforcement of legal frameworks; full protection of human rights
3. Equity and Inclusiveness – opportunities for everyone
4. Accountability – to everyone who may be affected by its decisions or actions
5. Responsiveness – serving the needs of all stakeholders within a
reasonable timeframe
6. Participation – informed and organized; freedom of association and expression
7. Effectiveness and Efficiency – meeting the needs of the society and making
the best use of resources
8. Transparency – freely available and directly accessible information;
enough information in easily understandable forms and media
Efficiency – doing things right
Effectiveness – doing the right things
CORPORATE GOVERNANCE – system of rules, practices, and processes by
which business corporations are directed and controlled
Greatly contributes to financial market stability and economic growth
PURPOSES:
