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CANO, MABELLE SHARLA T.

FEBRUARY 17, 2014
Bachelor of Science in Accountancy Prof. Ernie “Bhong” Radin, MBA


1. What is Corporate Governance?

- refers to the system by which corporations are directed and controlled.
- The framework of rules and practices by which a board of directors ensures
accountability, fairness and transparency in a company’s relationship with its all
stakeholders.

2. What are the principles of Corporate Governance?

2.1 Lay solid foundations for management and oversight-recognize and publish
the respective roles and responsibilities of Board and management.
2.2 Structure the Board to add value-Have a Board of effective composition, size
and commitment to adequately discharge its responsibilities and duties.
2.3 Promote ethical and responsible decision-making-Actively promote ethical
and responsible decision-making
2.4 Safeguard integrity in financial reporting-Have a structure to independently
verify and safeguard the integrity of the Company's financial reporting
2.5 Make timely and balanced disclosure-Promote timely and balanced disclosure
of all material matters concerning the Company.

3. What are the advantages and disadvantages of Corporate Governance?

Advantages:

1. Enhanced Performance- corporate governance helps a company improve
overall performance.
2. Access to Capital- the better corporate governance a company has the more
easily it can access outside capital that the business can use to fund its
projects.

Disadvantages:

1. Family-Owned Companies-Corporate governance works at its best when
shareholders and board members are able to make objective decisions that are
in the best interest of the company.
2. Easily Corruptible- Corporate governance needs a certain level of government
oversight to avoid increasing levels of corruption.

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ANDAYA, JENNIFER M. FEBRUARY 17, 2014
Bachelor of Science in Accountancy Prof. Ernie “Bhong” Radin, MBA




1. What is Corporate Governance?

The system of rules, practices and processes by which a company is directed and
controlled. Corporate governance essentially involves balancing the interests of
the many stakeholders in a company.

2. What are the principles of Corporate Governance?

- Respect the rights of shareholders-Respect the rights of shareholders and facilitate the
effective exercise of those rights
- Recognize and Manage risk-Establish a sound system of risk oversight and
management and internal control
- Encourage enhanced performance- Fairly review and actively encourage enhanced
Board and management effectiveness
- Remunerate fairly and responsibly-Ensure that the level and composition of
remuneration is sufficient and reasonable and that its relationship to corporate and
individual performance is defined
- Recognize the legitimate interests of stakeholders -recognize legal and other
obligations to all legitimate stakeholders.


3. What are the advantages and disadvantages of Corporate Governance?

Advantages:

- Enhanced Performance- corporate governance helps a company improve overall
performance.
- Access to Capital- the better corporate governance a company has the more easily
it can access outside capital that the business can use to fund its projects.

Disadvantages:

- Family-Owned Companies-Corporate governance works at its best when shareholders
and board members are able to make objective decisions that are in the best interest of
the company.
- Easily Corruptible- Corporate governance needs a certain level of government
oversight to avoid increasing levels of corruption.

.