Role, Value And Characteristics Of Corporate Governance

A business ultimate objective is to maximize their shareholders wealth and value. “Shareholders value gets lost when things are done illegally, when corporate governance is not adhered to or when cohesive action is not taken.”- Cyrus Pallenji Mistry. In addition to Cyrus’s words, I further want to state the role, value and importance of corporate governance as it provides a framework for meeting a company’s objectives and it influence practically every part of management, from action plans and internal controls to performance measurement and corporate disclosure.
Therefor I disagree with the statement of Koos Bekker that corporate governance is only important when a company is not performing well, but that corporate governance should rather

Efficiency and globalization are only some of the many factors encouraging corporate governance structures. A big advantage of Corporate Governance is that it develops added value for the stakeholders and encourage a trustworthy, moral and ethical environment as set out by the King 3’s Code of Conduct Report. Economic growth and corporate success are some of the added values that corporate governance contributes in benefit of a company and its shareholders. Characteristics of good governance

When corporate governance structures are sufficiently used, the company can raise dividends and lower the overall capital costs, which preserves investors’ confidence. It also has a positive impact in the market, both reputational and economical, which leads to better share prices and it provides the management and employees of the company with a guideline to achieve their objectives in a way which are in best interest of both the company and its