Assignment No.

1
Module 01

Name: Allysa Mae Y. Linares Section: JK 1

Course: Governance, Business Ethics, Date Submitted: Nov. 3, 2022
Risk Management, and Internal Controls

1. In your own understanding, define and explain governance. (5 points)

2. Explain how governance can be used in the following contexts and give appropriate
examples. Cite and explain the particular characteristic or principle of your chosen example.
Select only two contexts below: (10 points)

▪ National governance
▪ Local governance
▪ Corporate governance
▪ International governance

3. Explain the purpose, objectives, and impact of corporate governance. (10 points)

4. The basic principles of effective corporate governance include (1) Transparency and Full
Disclosure, (2) Accountability, and (3) Corporate Control. Choose only one of these principles
and explain and apply such in the context of the three key elements of corporate governance:
Management, Those Charged with Governance (e.g. Board of Directors), and the
Owners/Shareholders. (15 points)

ANSWERS:

1. A society's method of using power, authority, and influence to enact laws and make
choices affecting public affairs and the advancement of society is known as governance.
Over a social system, it may be carried out by a nation's government, a market, or a
network. It can be used to a variety of situations, including corporate governance,
international governance, national and municipal governance, and more. As a result,
governance is concerned with the process of decision-making and the method by which
decisions are carried out or not through the use of authority and power by leaders of the
nation or organizations.

2.
▪ National Governance
According to common understanding, national governance is the central foundation of
the modern world's political order. Fundamental aspects of our world are shaped by
political and economic power structures, but these structures are not static; they are
undergoing substantial changes. Furthermore, it is in charge of preserving peace and
security both inside and outside the country. Consider the national government of the
Philippines as an example of it being distinct from the national governments of other
nations.
▪ Local Governance
Technically speaking, local governance is the management of the local affairs of a city,
town, or other district by its citizens. This framework establishes a specific unit inside a
given organization or nation and grants local governing bodies the authority and capacity to
manage a sizeable number of public affairs, operating legally on their own initiative and in
the best interests of the local community. For example, the LGU, or Local Government Unit,
is in charge of municipal and city affairs.
 Assignment No. 1
Module 01

Name: Allysa Mae Y. Linares Section: JK 1

Course: Governance, Business Ethics, Date Submitted: Nov. 3, 2022
Risk Management, and Internal Controls

3. The purpose of corporate governance is to aid in the establishment of trust, accountability,

and transparency required for promoting long-term investment, financial stability, and
commercial integrity, thereby enabling societies to achieve better growth. Since increasing
and maximizing shareholder wealth and safeguarding the interests of other stakeholder
groups are the two main goals of corporate governance, In addition, the primary objectives
of corporate governance are to protect the interests of other stakeholders and raise the
value of the company for its owners. Corporate governance is seen as having a substantial
impact on an economy's potential for growth and development. By boosting the legitimacy
of shareholders, good corporate governance standards help the economy run better and
create sources for capital investment.

4. Corporate control is the authority to determine how a company will run its business and
develop its strategy. This includes making important decisions about capital allocation,
purchases and sales, top-level hiring and firing, and major marketing, production, and
financial choices. Legal authority, ownership, or the authority of one's position within the
organization can both be used to determine who has the ability to make decisions about the
operations and policies of a company. Corporate control in the context of management is
being applied as the chief executive officer leads the management team that is in charge of
developing, overseeing, and carrying out the company's strategies. This includes, but is not
limited to, managing the company's operations while the board oversees them and keeping
the board up to date on their progress. Strategic planning, risk management, and financial
reporting are all duties of management. A competent management team steers clear of
placing excessive emphasis on short-term key metrics by running the business with a focus
on carrying out the company's strategy over a substantial time horizon. In order to
accomplish long-term value development, the board of directors administers corporate
control in the sense of directing the management and business strategy of the organization.
The board frequently evaluates management's plans to address company resilience,
including elements like business continuity, physical security, cybersecurity, and crisis
management, as part of its responsibility for risk supervision. The board oversees the
company's compliance program and keeps abreast of any important compliance issues that
might emerge under the direction of the appropriate committees. Lastly, shareholders
perform their role as they practice corporate control by taking part in the strategic planning
and decision-making processes of the company, which traditionally belonged solely to the
board and management. Shareholders entail some level of responsibility on their part in
order to achieve the objective of long-term value growth for the business and all of its
shareholders.