Corporate governance refers to the system of rules, practices and procedures that businesses use to manage themselves. This governance framework establishes the checks-and-balances that keep companies accountable to their shareholders, employees and other stakeholders.
Different corporate governance models are in use in modern business, and each has a unique impact on the overall performance of a company. Certain governance systems are more focused on the stock market, whereas others focus more on the company’s customers, or its employees.
The main responsibilities of the board are controlling the company’s strategy and ensuring the compliance of ethical and legal requirements. The board also has to oversee management including the CEO. This requires active participation of all directors and preparation for board meetings.
A structure of committees that is efficient allows the board to look at and discuss topics in greater depth than is possible to do during full-board meetings. The board should determine the functions that should be performed by each committee, and determine the members of those committees.
The governance structure of a company should be fair for all shareholders. This means avoiding decisions which favor one group of shareholders over another. It also means treating suppliers, vendors and communities equally.
The role of view publisher site dailyboardroom.com/what-may-be-given-by-the-data-room/ the board varies in accordance with the industry and the country. In the United States, for example the Securities and Exchange Commission (SEC) has established guidelines for boards in areas such as ESG reporting, cybersecurity and governance structures. The SEC’s requirements are supplemented by the guidance of top global university centers for excellence in management and leadership.