Features of Corporate Governance
The characteristics or features of corporate governance are listed below.
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- Transparency : This means that the Board of Directors must release all relevant information to the stakeholders. They must show all the necessary financial and operational data to the stakeholders. They must not hide any important information or maintain any secrecy.
- Protection of Shareholders' Rights : The Board of Directors must protect the rights of the stakeholders. They must protect all the stakeholders, especially the minority stakeholders.
- More Powers to CEO : The CEO must be given more powers so that he can approve the companies plans and strategies independently.
- Accountability : The CEO and the Board of Directors must be made accountable for their actions to the stakeholders and to the entire society.
- Based on Ethics : Corporate governance is based on ethics, moral principles and values. So, the Board of directors must avoid unfair practices, cheating, exploitation, etc.
- Universal Application : Corporate governance has universal application. That is, it is used by companies all over the world. It is given a legal recognition in many countries. All companies must use corporate governance voluntarily.
- Systematic : Corporate governance is very systematic. It is based on laws, procedures, practices, rules, etc. All these laws are made to increase the wealth of the shareholders and to protect the rights of all the stakeholders of the company.