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Corporate Governance

What is corporate governance?

Corporate governance is the framework of rules, policies, and procedures by which determines a corporation’s overall direction and performance. It typically takes into account the corporation’s various financial legal, regulatory, institutional, and ethical responsibilities to its various stakeholders.

Who oversees corporate governance? 

The board of directors typically is the topmost authority on a corporation’s governance. For the board, corporate governance becomes the playbook by which it is expected to perform its duties.

What is good corporate governance? 

In the United States and the United Kingdom, the principles of good corporate governance include: a board that is independent and not beholden to the CEO or management; a board whose members represent a diversity in age, experience and background; an organizational commitment to long-term planning and vision; a dedication to common accounting standards; a high level of disclosure and transparency; and an ongoing dialogue between the board, senior management, and all other stakeholders.

Is there just one kind of corporate governance? 

No. The good corporate governance principles described above stem from the “Anglo-American” model of corporate governance, which emphasizes the interests of shareholders. The coordinated model of corporate governance, which is prevalent in Continental Europe and Japan, emphasizes the interests of employees, suppliers, customers, and the community.

Accounting & Auditing Update Blog

Grant Thornton forms audit quality advisory panel

Tammy Whitehouse | February 1, 2019

Grant Thornton is joining the Big 4 in appointing more leadership to its firm governance to drive more focus on audit quality.

Accounting & Auditing Update Blog

EY forms independent audit quality committee

Tammy Whitehouse | January 24, 2019

EY has joined the rest of the Big Four in seeking independent consult on audit quality, forming a committee of outside experts to advise firm leaders.

Global Glimpses Blog

FRC issues corporate governance principles for private companies

Paul Hodgson | December 12, 2018

The Financial Reporting Council (FRC) issued its long-awaited corporate governance standards for private companies, providing a framework to help the companies meet legal requirements and improve and disclose their governance.

Accounting & Auditing Update Blog

EY plans succession as global chairman, CEO resigns

Tammy Whitehouse | December 4, 2018

EY says it will name a new global chairman and CEO in January to replace Mark Weinberger, who plans to step down July 1, 2019.

The Filing Cabinet Blog

CEOs pledge ‘commonsense corporate governance principles’

Joe Mont | October 30, 2018

CEOs of 20 leading public companies, pension funds and investment firms have signed onto a continuing effort intended to “jumpstart a national conversation on corporate governance.”

News Article

Carillion: compliance without complying

Paul Hodgson | February 6, 2018

The Carillion collapse illustrates once again that compliance with the U.K. corporate governance code does nothing to prevent bad actors from making bad decisions.

News Article

U.K. corporate governance reforms

Neil Hodge | September 12, 2017

Neil Hodge explores the government’s corporate governance reform proposals relating to executive pay; strengthening the employee, customer, and supplier voice; and large, privately held businesses.

News Article

The Financial Reporting Council makes its case for broader powers

Neil Hodge | April 18, 2017

An influential committee of Members of Parliament has recommended a wide-ranging series of changes aimed at boosting the powers of the U.K.’s corporate governance regulator.

Global Glimpses Blog

ICSA initiates governance sea change

Paul Hodgson | February 24, 2017

A call to overhaul the U.K. board governance system involves an unlikely alliance of organizations that underscores just how badly some camps want change. Paul Hodgson has more.