Corporate governance is the establishing of policies, rules, and procedures that guide an organization. It also takes into account the interests of shareholders, customers and employees as well as government, lenders and community. These elements are essential for a flourishing, strong business.

The person element of good governance ensures that those who are involved in the company’s activities are ethical, trustworthy and dedicated to the company’s goals. This is especially important at an era where people are sick of corruption and are demanding more transparency, accountability, and equity.

A transparent reporting system is an essential component of good corporate governance. This means that a board receives thorough financial reports every month which provide a clear view of how the company’s performance has been, and why. It is also Recommended Site a good idea for boards to have a system of checks and balances in place to prevent fraud and mismanagement.

Guidelines and policies are also an crucial to good corporate governance. They should reflect the company’s culture, align with legislation/regulations and internal policies, and be clearly available to all stakeholders.

A presiding director is an autonomous director who supervises and directs the board. This is a key element of good corporate governance. This is especially crucial if a company’s board leadership structure is a combination of chair and CEO, or if there are personal connections among top leadership. The company must also ensure that its compensation practices don’t result in conflicts of interest among directors.