Report and Analysis of Corporate Governance

2021 Words9 Pages
Introduction The increased incidence of the economic crisis in affect to all the world economy, especially the leading developed country, United States and Britain in1980’s (Weir & Laing, 2001) and has become to importance of corporate governance and also in developing countries (Rasiah, 1999), The economic loss and damage of investment of investors are the result of inefficiency of corporate governance, which caused of lack of the inspection and monitoring the actions of management and directors should protect the interests of the shareholder from inappropriate behavior that is include dishonest, misconduct or even distort the number in financial statements to mislead the stakeholders make wrong decision affect to loss a lot of money (Mohammad Abdullah, 2008). Corporate governance is created because of the failure operation of the company between the owner and management team known as Agency Problem is a contract between the owner and the executive cannot eliminate the problem and this cause lead to adjust the rules. Definition of corporate governance has variety of meaning. Corporate governance also provides the structure through which the objectives of the company are set, and the means of attaining those objectives and monitoring performance are determined.” (OECD, 2004). According to Magdi and Naradereh(2002) argues that corporate governance focus on business will continue to be well by investors get fairly return. Moreover, The definition by Tricker, (1994) focuses on the board room and adds owners and others interested on the scope in the affairs of the company, including creditor, debt financiers, analysis, auditors and regulate regulators, indicated the audience for company financial report, consistent with both Trickers... ... middle of paper ... ...ation. For the aspects of governance according to principle agent theory, the results of it are effectual and reliable in dealing with the issues of corporate governance. Conclusion In conclusion, this paper has reviewed to Cadbury report, Geenbury report, PAT theory and also analyze this theory with the case study of the company in UK and it is clearly that corporate governance is effective transparent performance with the highly management in order to increase income and shareholders. The companies can increase trust from shareholders and investors by using the accountability and transparency component of corporate governance. The company has to run both smartly and honestly for the guaranty's stakeholders. Corporate governance would enhance stakeholders’ confidence. Moreover, for this reason, it can be supported the business's sustainability in the long term.

More about Report and Analysis of Corporate Governance

Open Document