1. INTRODUCTION TO
CORPORATE GOVERNANCE

2. THE CONCEPT OF CORPORATE GOVERNANCE
CORPORATE GOVERNANCE is defined as:
The system by which corporations are directed, controlled and held to account.

3. The manner in which the power of, and power over, a corporation is exercised in the stewardship of its assets and resources so as to increase and sustain shareholder value as well as satisfying the needs and interests of all stakeholders.

4. SCOPE OF CORPORATE GOVERNANCE
Corporate governance covers:
“”Licence to Operate” – Public policy, national values, ethics
Systems for supervising, monitoring, regulating and controlling corporations – regulatory authorities, national trade and business associations, professional bodies and society as a whole.

5. SCOPE OF CORPORATE GOVERNANCE
Systems, practices and procedures by which the individual corporation regulates itself in order to remain competitive, sustainable, relevant and legitimate for competitiveness and sustainability.
CACG/ PSCGT

6. This may be viewed from the perspective of:
Society
Shareholders
Directors

7. INTEREST IN CORPORATE GOVERNANCE
The society needs to reassure itself that:
The corporate business enterprises are viable, sustainable and competitive;
The corporations are held accountable;
The corporations do not run amok;
The corporations competitively attract investments;
CACG/ PSCGT

8. Corporations are responsible corporate citizens;
Corporations comply with the legal framework and remain relevant and legitimate in society;
CACG/ PSCGT

9. INTEREST IN CORPORATE GOVERNANCE
The Shareholder needs to reassure him/ herself that:
There is corporate democracy, protection of the minority and transparent corporate reporting;
There is recognition of shareholder rights fairness and equitable treatment of all investors;
CACG/ PSCGT

10. There is corporate leadership for efficiency and probity;
The corporation is responsible, responsive, accountable, transparent, competitive and sustainable;
CACG/ PSCGT

11. There are increased profits and opportunities for investment.
CACG/ PSCGT

12. INTEREST IN CORPORATE GOVERNANCE
The Directors are interested in corporate governance because:
Their roles are increasingly becoming more professional and much more demanding;
They need to clearly understand their roles, duties, responsibilities and liabilities;
CACG/ PSCGT

13. They need to gain/ have an adequate knowledge of the business they direct as well as good corporate governance principles and practices.
CACG/ PSCGT

14. FORCES DRIVING INTEREST IN CORPORATE GOVERNANCE
These include:
Corporate failures and scandals;
The Asian financial crisis
The fight against money laundering, corruption, bribery and abuse of corporate power;
CACG/ PSCGT

15. FORCES DRIVING INTEREST IN CORPORATE GOVERNANCE
Shareholder activism
The global “governance revolution”
Globalization and economic liberalization’
The green [environment] movement;
CACG/ PSCGT

16. FORCES DRIVING INTEREST IN CORPORATE GOVERNANCE
The power of transnationals and multinationals;
The enhanced separation of ownership from control;
The need to make corporations viable destinations for investment in a competitive global market;
CACG/ PSCGT

17. FORCES DRIVING INTEREST IN CORPORATE GOVERNANCE
The realisation that good corporate governance has “an economic payoff”;
CACG/ PSCGT

18. AIMS OF GOOD CORPORATE GOVERNANCE
Increased profitability and efficiency of corporation;
Enhanced ability to create wealth for shareholders;
Increased employment opportunities;
CACG/ PSCGT

19. AIMS OF GOOD CORPORATE GOVERNANCE
Increased benefits to stakeholders;
Sustainability and enhanced competitiveness of enterprises;
Increased capacity of corporations to attract investment;
CACG/ PSCGT

20. AIMS OF GOOD CORPORATE GOVERNANCE
Enhanced legitimacy, responsibility and responsiveness of the corporation;
Transparency, accountability and probity of corporation;
CACG/ PSCGT

21. __________________________________
CACG/ PSCGT

22. CORPORATE GOVERNANCE AS AN INCLUSIVE APPROACH
Note: The corporation operates in society, on society and for society;
Therefore, they must create relationships with all stakeholders;
Directors’ decisions affect investments, shape the economy and even our lives for a long-time to come;
CACG/ PSCGT

23. __________________________________
CACG/ PSCGT

24. CORPORATE GOVERNANCE AS AN INCLUSIVE APPROACH
It is in the interest of the business enterprise and in the very best long-term interest of shareholders to ensure the enterprise does not short-change its customers, exploit its labour, pollute the environment, antagonize its suppliers, lenders or the host community
CACG/ PSCG

25. __________________________________
CACG/ PSCGT