Question

A set of *relationships between a company’s board*, its *shareholders* and other *stakeholders* providing the structures through which the *objectives* of the company are set, and the means of attaining those *objectives*, and monitoring *performance*. justify how this definition supports good corporate governance with particular attention to the bolded words.

Answer 1

Good corporate governance will be having a focus at better relationship between board and the shareholder so there will be lesser agency conflicts and goals of each other can be synchronised in order to maximize the value of company.

It is a structure through which the goals and objective of a company after consideration of various stakeholder are set and they are functional to achieve these objectives in order to maximize the value of the company.

These corporate governance mechanism will be monitoring the performance of individual employees by comparing it with standard performance and working upon the differential between actual performance and standard performance in order to find out the deviations and they will be trying to work upon that variance in order to to maintain optimum control mechanism which will help in maximizing the value of company.

So it can be said that corporate governance will always be advocating higher level of cooperation and coordination and synchronisation between various stakeholders in order to help each other by maximizing the value of company.