Question

PLEASE BE DETAILED & CITE all SOURCES : Write on the key aspects of corporate governance. Be sure to address in DETAIL the following:

• ethical considerations
• why corporate governance models so often fail

Answer 1

Key aspects of corporate governance are to establish proper rules and regulations as per statutory requirements and welfare of the stakeholders so that there is transparency and accountability within the organisation. Corporate governance is using consolidated framework of all the participants in taking decisions that are based on best practices and avoid any malfunctioning or mismanagement of the organisational procedures. It is ethical complications as corporate governance is framework of rules to reduce misappropriation of resources and instead follow truthfulness, virtue and fairness in business practices. It is made for reducing the chances of individuals working for self interest and increased consciousness for responsibility.

There are cases of failure of corporate governance as with multiple stakeholders it becomes difficult to hold liable a particular group or entity for any misappropriation or frauds. The corporate governance gives responsibility to management and often with mutual consent and understanding corporate governance rules are not followed for saving costs or taking short cuts for self interests as there are many ways to escape with shareholders also at times involved in buying and selling before any major controversy or bankruptcy is declared. The goal of profit maximisation is the main reason for failure of corporate governance and ethics can increase the compliance of corporate governance along with corporate social responsibility.