Corporate Governance: The Relationship And Structure Of Corporate Governance

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CORPORATE GOVERNANCE Corporate Governance is referred as the process through which power of a corporation is exercised to manage the corporation’s total portfolio of assets and resources for maintaining and increasing shareholder value and satisfy stakeholders of the company. Corporate governance expresses the relationship, structure of rules, and process by which authority controls inner corporations. It encloses the mechanism, in which companies and the people be held to account. The good corporate governance enhances the shareholder morale which is very crucial. It gives the guidelines of how to control the business so that it can achieve its goals as well as also profitable to its shareholder for a long time. Shareholders as above can be…show more content…
Centralized form of governance means decision-making authority and all powers stay with the upper level of management. The structure of the organization is horizontal in centralized form. Whereas, in decentralized form of governance, the hierarchy goes vertical thus giving the strategic decision-making authority to front line manager or low-level management. Most corporate governance structures are composed of a board of directors, an executive management team, and various departments that are structured according to function, division, or a combination of both. The board of directors usually has the greatest power, control, and authority in any organization. They have the voting authority and help shape executive strategies. In public corporations, the board of directors also acts as a sort of liaison between the company's executive management team and its stakeholders. A centralized organization allows minimum creativity and flexibility for its staff and often assigns very specific responsibilities and authority to each position whereas decentralized organization directly engage all employees in decisions that affect or related to their job tasks. Between the two corporate governance structures, decentralized organizations are likely to encourage a more collaborative business environment because they allow more open communication thus results in…show more content…
Measuring the eagerness of contractor to make introductory public offering of stock. 3. Analyzing the function of external as well as internal markets from corporate control perspective. For this purpose, some succeeded in measuring growth influence of shareholder and their effects on the industry, nationwide relation and suggest the ways to reduce stockholder stress by trade union actions. Some universal standards of measuring performance such as Graphic Rating Scales which is ideal for production-oriented work environments, Management by Objectives which is useful for measuring the performance of employees in supervisory or managerial positions and forced ranking are the methods which are used in all over the world for measuring of performance of employees or any other in the company. More formal ways are observed in Europe like performance management systems are designed for the evaluating employee performance while in UAE not much formal ways are observed in every company (Mayhew, 2013). Bibliography ASX Corporate Governance Council. (n.d.). Corporate Governance Principles . Retrieved from
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