Question

Go into the details of why is the implementation of corporate governance important?
Class: Commercial Finance

Answer 1

Corporate Governance -

Corporate Governance is the system by which companies are directed and governed by the management. Through use of ethical business processes, the management is able to ensure accountability, transparency and fairness in the company operations, thereby ensuring that the interests of shareholders and all other stakeholders are protected

Importance of Corporate Governance

- It helps to put strong internal controls in place

- Reliable information systems can be put in place

-- Encourages stakeholders in all aspects , Gives better employee benefits, increases share holders wealth, customer statisfaction

- Better Financial Reporting will be ensured with the help of competent board

- Reducing the risk of fraud throght robust mechanisms that are put in place by high level management

- High corporate governance will ensure better reputation to the entuty

- Higher Company valuation

- Easy Acess to Financial Markets and successful fund raising.

- Greater Credibility