Question

Identify at least three external control mechanisms. Discuss the role played by each of these.

Answer 1

External control mechanisms are controlled by them outside an firm and help the goals of entities such as regulators, governments, trade unions and financial institutions. These goals include adequate debt management and legal compliance. External mechanisms are often affected by a firm by external stakeholders in the forms of union contracts or regulatory guidelines. External firms, such as industry associations, may guide guidelines for good practices, and businesses can choose to follow these guidelines or ignore them. these firms report the status and compliance of external corporate governance mechanisms to external stakeholders.

The 3 external control mechanics are:

1.A market for capital Control: The purchasing of the company that is underperforming relative to the industry rivals in order to increase firm competitiveness.

2. Media and Public activist: What is happening in the society and social moving.

3.bank and Investment analysts: The current situation of the economy, the inflation rates, Debts and Credits .