Structure Of Corporate Governance

Introduction As stated in the Nudge Theory in the 2000’s “…. that governance must be driven by needs of the people being governed, not by the governing authority.” Corporate Governance has over the past twenty years become an important subject in the world of finance owing to the control that rests in the hands of owners/shareholder, directors and senior officers of a corporation in the financial decisions of the said corporation. Corporate Governance refers to the systems by which a corporation is directed and controlled by its shareholders, directors, and officers. The structure of governance specifies the rights and responsibilities of different participants in the corporation with regard both to one another and outside parties. These laws generally relate to the boards of directors, managers, shareholders, creditors, auditors, regulators, and other stakeholders. Corporate Governance is a specialized mechanism for regulating risk in corporate activities, thereby (hopefully) averting corporate disasters, scandals, and consequential damage or losses to investors, staff, society and the wider world. History of Corporate Governance The need for corporate governance arose in the second industrial revolution during which there was change in the corporate structures as the United States and Europe started large

The objectives of the corporations, the methods of achieving the objectives set and the supervising performance are determined by the relationships between the shareholders, Board of Directors and the its stakeholder which is essentially the structure of the corporations. The key aspects of good corporate governance is the transparency of the structure and operation of the corporation and accountability of the managers and board of directors to the shareholder of the