Question

 Define Corporate Governance. Explain the various models of Corporate Governance. Why is Corporate Governance important for organisations in today's business environment?

07 Aug 2026
Answer :
Word Count : 1013
Corporate governance refers to the system of rules, practices, processes, and relationships by which an organization is directed and controlled. It encompasses the mechanisms through which companies, and those in control, are held accountable to stakeholders. In strategic management, corporate governance plays a crucial role in ensuring that organizational objectives are aligned with the interests of shareholders and other stakeholders such as employees, customers, suppliers, and society at large. It defines the distribution of rights and responsibilities among different participants in the corporation, such as the board of directors, management, shareholders, and other stakeholders, and lays down the procedures for decision-making. Various models of corporate governance have evolved across countries, reflecting differences in legal systems, cultural values, ownership patterns, and economic structures. One of the most widely discussed models is the Anglo-American model, also known as the shareholder-oriented model. This model is prevalent in countries like the United States and the United Kingdom, where ownership is typically dispersed among a large number of shareholders. The primary objective of this model is to maximize shareholder wealth. The governance structure is characterized by a strong emphasis on the role of the board of directors, transparency, disclosure, and accountability. Independent directors play a key role ________ ___ __________ _______ ______ ________ ___ _______ __________.
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