1. Corporate governance principles and entrepreneurship firms V.Darškuvienė Vytautas Magnus University Kaunas

2. Conceptual issues Academic and policy debates  On principal-agent relationship  On information asymmetry  Greater effectiveness of the system, lowering transaction costs if agency relationships are regulated ▫Corporate governance as a goal itself ▫vs ▫Corporate governance as a tool to improve firm performance, concentrate on growth, innovation, sustainability, survival

3. Good corporate governance Max SHV Constructing the framework Clear & credible principles Aligning shareholder interests  Based on ▫Independent boards – goal & strategic direction setting ▫Transparent financial reporting - accountability

4. Corporate governance development CodesPrinciples For unlisted companies For listed companies Major contribution to growth & employment Major contribution to growth & employment

5. Applicability of CG principles Listed vs unlisted companies? Large vs SMEs companies?  Are there connections between corporate governance and entrepreneurship?  What might be the implications of adoption of corporate governance principles to entrepreneurship firms?

6. Conceptual issues Conditions for value creation  Entrepreneurship culture  Developing organizational framework  Incentives for different stakeholders (incl. employees)  Protection of innovative initiatives

7. The necessity of good corporate governance for SMEs Need to access to financial resources for growth Need for effective strategies and their implementation Introduction of professional management Proper remuneration and retaining key employees

8. Key objectives of CG codes / principles “Equal” understandi ng of transparent management Improving information disclosure Increasing management quality Enhancing confidence of international investors

9. Development towards - Principles for unlisted companies, phase 1 Governance framework Board effectiveness, size, composition Remuneration policy Risk oversight and internal control Dialogue between board and investors Skills of board members Family governance mechanisms

10. Are major concerns addressed? Long-term vs short term interests of stakeholders? Transferability of shares / succession planning? Conflict resolution procedures? Transparency? Encouraging creativity and innovation?

11. Corporate governance regulation impact IncentivesRestrictions Entrepreneurship firms