Governance is the system of checks and balances that are put in place to ensure your business operates click over here smoothly, is in line with its goals, is able to take appropriate risks, and maintains its integrity. It is a process that identifies the best ways to run your company and understands changes in the external environment that are beyond your control. This will help your company develop a strong relationship and trust with its community, shareholders and customers.
It is important to have a solid corporate governance in place, particularly during times of rapid growth or crises. It shows that you care about your company’s future and are ready to face any challenges that come along.
Investors are more likely to invest in companies with good governance that shows they take the time to make informed decisions and operate in a transparent manner. It can also show that your company is committed to fulfilling legal, ethical and market driven obligations with stakeholders including employees, non-shareholders, suppliers, local communities, and the policy makers.
The board must be able of fulfilling its obligations to shareholders with enough autonomy and expertise. It should also be able to maintain an appropriate balance between executive and independent directors. It should be able supervise risk, review, and evaluate management performance, and have a clearly defined procedure for resolving such issues like conflicts of interest or failure to meet the requirements. It should also be able to communicate effectively and transparently with shareholders on governance issues.