Corporate governance is a subject of complex policy, ethics and practice that has various stakeholders. It encompasses the systems and structures that guarantee transparency, accountability and probity in the reporting and operation of companies. It covers the manner in which boards supervise the management of the executive team of a business and how they choose, monitor and evaluate the performance of the CEO. It also entails the way directors make financial decisions and how they report these to shareholders.

Corporate Governance became the subject of intense debate in the 1990s, as a result of structural reforms that helped build markets in former Soviet countries as well as the Asian financial crisis. The Enron scandal in 2002, followed by institutional shareholder activism, and the financial crisis of 2008, increased scrutiny. Corporate governance is a hot topic in the present, with new ideas and pressures constantly emerging.

The dominant the most useful checklist for board meetings school of thought, known as the “shareholder primacy” view or Anglo-Saxon method, places a higher priority on shareholders. Shareholders elect a board directors who direct management and establishes the business’s strategic goals. The board has the responsibility to select and evaluate the CEO, establish and monitor the enterprise policies regarding risk management and supervise the operations of the business. They also provide reports on their management to shareholders.

Integrity, transparency, fairness, and responsibility are the four core principles of effective corporate governance. Integrity relates to the ethical and responsible way in which board members make decisions. Transparency means transparency and honesty as well as the full public disclosure of information to all stakeholders. Fairness refers to how boards treat their employees as well as their suppliers and customers. The responsibility of a board is how it interacts with its members and the community in general.