Corporate Governance - It's All About Goodness

[Acid]

Okay guys , I am really tired and bored of reading about corporate governance . It formed a part of my 1.3 , F4 and now P1 Studies.

The one thing common which I heard was all about Corporate governance is all about ensuring that the company is well run , there are no frauds , companies performance is maintained and there is no conflict of interest between the stake holders.

The need for corporate governance arises in Joint Stock companies i.e. Companies with listed shares.

As in big corporations the shareholders who are the owners of the company are not involved in the running of the company. They may not even have a clue about how to run a small company! Shareholders may be institutional investors who may be accountale to pension scheme funds etc. So the aim of institutional investors would soley to be earn money ! Thats it . doesnt matter how wonderful product the company is producing. All they need is $$$$.

Now the problem is , All they need is money which may pressure the executives of the company who are those involved in the running of the company to just do anything and satisfy the appetite of money for those money looking investors . They may make them take those actions which are not in the long term interest of the company.

So poor sandwiched directors of the company. They have conflicting demands placed on them. One oneside they are to ensure longterm success of the company and on other hand earning $$$.

This means that we need something in place to work as a rope for all the stakeholders which would make all the stakeholders of the company satisfied.

But how are we gonna do that?

Watch out for my next post !

[chioma]

Hi Acid, how I wish it just ends as d summary u have given.:nah: I wud say u nid 2 know alot more.
1. say what moral level wud an individual be in to lead him/her to act in a given or expected manner? ie moral stance.
2. In what situations can an accountant find whistleblowing appropriate?
3. What are r the prof. conducts or behaviours expected of an accountant, especially to benefit d public? In essence Acid what wud u do in d normal cause of ur work and feel proud of it anytime it is discovered or brought up for discussion.
4. Has ur conscience been satisfied that u did ur very best in such a situation?
5.Having taught abt all this,then coys r expected to act as corporate citizens, thru directors ie those held accountable & responsible for their acts, in dealing with matters of not just ltd to shareholders anymore, but inclusive of various stakeholders in d wider perspective ie sustainability reporting.
6. Investors trust auditors opinions b4 investing in coy, so a grt deal of trust is needed here & must not be betrayed, other $millions cud be lost as wuz d case wit Authur Andersen & Enron, worldcom, parmalat & d lastest Airbus CEO arrest.
7.With detailed knowledge of these, as in examples from past questions, u r well on ur way to success this december. Goodluck.QUOTE=Acid;6069]Okay guys , I am really tired and bored of reading about corporate governance . It formed a part of my 1.3 , F4 and now P1 Studies.

The one thing common which I heard was all about Corporate governance is all about ensuring that the company is well run , there are no frauds , companies performance is maintained and there is no conflict of interest between the stake holders.

The need for corporate governance arises in Joint Stock companies i.e. Companies with listed shares.

As in big corporations the shareholders who are the owners of the company are not involved in the running of the company. They may not even have a clue about how to run a small company! Shareholders may be institutional investors who may be accountale to pension scheme funds etc. So the aim of institutional investors would soley to be earn money ! Thats it . doesnt matter how wonderful product the company is producing. All they need is $$$$.

Now the problem is , All they need is money which may pressure the executives of the company who are those involved in the running of the company to just do anything and satisfy the appetite of money for those money looking investors . They may make them take those actions which are not in the long term interest of the company.

So poor sandwiched directors of the company. They have conflicting demands placed on them. One oneside they are to ensure longterm success of the company and on other hand earning $$$.

This means that we need something in place to work as a rope for all the stakeholders which would make all the stakeholders of the company satisfied.

But how are we gonna do that?

Watch out for my next post ![/QUOTE]

[Acid]

Thank you Chioma

As i mentioned that I would be expanding on CG in my next post but you did my job!

Thanks very much & Pls. stay in touch!