A good governance standard provides a common corporate "language," and work instructions to decide and take actions for either grasping opportunities or managing risks.
Accountability: Ensuring that the company's management is accountable to the board and the board is accountable to shareholders. This involves a clear delineation of roles and responsibilities within the organization to ensure effective oversight and decision-making.
Transparency: Providing timely and accurate disclosure of all material matters regarding the corporation, including its financial situation, performance, ownership, and governance. Transparency helps build trust with stakeholders and facilitates informed decision-making.
Fairness: Protecting shareholder rights and ensuring equitable treatment of all shareholders, including minority and foreign shareholders. All shareholders should have the opportunity to obtain effective redress for violations of their rights.
Responsibility: Recognizing the rights of stakeholders as established by law or through mutual agreements and encouraging active cooperation between corporations and stakeholders in creating wealth, jobs, and the sustainability of financially sound enterprises.
Independence: Ensuring that the board of directors can make decisions independently and free from undue influence from management or other stakeholders. This often involves having a significant number of independent directors on the board.
A good governance standard provides a common corporate "language," and work instructions to decide and take actions for either grasping opportunities or managing risks. These principles are designed to enhance the performance and accountability of corporations, ultimately contributing to economic efficiency and growth.
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