Key points

Fadun O. (2013) basically, there are two main traditional approaches to the study of corporate
governance: institutional and functional. An institutional approach to corporate governance focuses on
the appraisal of the existing institutions to maximise efficiency of services offered and improve
governance generally. This approach views institutions in the light of regulatory, legal and financial
frameworks which underpin the governance system. On the other hand, the functional approach
considers how different institutional framework function, subject to individual institution peculiar
features. The functional approach to corporate governance is flexible, as it provides for examining of
other possibilities. This implies that corporate governance issue is complex.