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Corporate Governance
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The tug of war between individual freedom and institutional power is a continuing theme of history. Early
on, the focus was on the church; more recently, it is was on the civil state. Today, the debate is about
making corporate power compatible with the needs of a democratic society. The modern corporation has
not only created untold wealth and given individuals the opportunity to express their genius and develop
their talents but also has imposed costs on individuals and society. How to encourage the liberation of
individual energy without inflicting unacceptable costs on individuals and society, therefore, has emerged
as a key challenge.
Corporate governance lies at the heart of this challenge. It deals with the systems, rules, and processes by
which corporate activity is directed. Narrow definitions focus on the relationships between corporate
managers, a company’s board of directors, and its shareholders. Broader descriptions encompass the
relationship of the corporation to all of its stakeholders and society, and cover the sets of laws,
regulations, listing rules, and voluntary private-sector practices that enable corporations to attract capital,
perform efficiently, generate profit, and meet both legal obligations and general societal expectations. The
wide variety of definitions and descriptions that have been advanced over the years also reflect their
origin: lawyers tend to focus on the contractual and fiduciary aspects of the governance function; finance
scholars and economists think about decision-making objectives, the potential for conflict of interest, and
the alignment of incentives, while management consultants tend to adopt a more task-oriented or
behavioral perspective.
Saylor - Personal Name
1st Edition
NONE
Corporate Governance
Corporate Governance
English
2005
1-235
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