LESSON 4:

GOOD CORPORATE GOVERNANCE

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 What is Good Corporate Governance ?
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 Good Corporate
Governance
Is the practice of is the practice of directing and
controlling the company through the relationship between
management with its stakeholders, the board of directors
governed by a system of rules, practices and processes.

It promotes the interests of the different Stakeholders,

they are the company’s shareholders, management,
customers, suppliers, financiers, government and
community to achieve maximum performance.
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 GCG involves the key principles of

Fairness

Accountability

Responsibility
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Transparency

Stewardship
 Fairness

This involves the concept of justice

as the central pillar that creates a
fair business environment.
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 Fairness may be shown as:

DISTRIBUTIVE PROCEDURAL INTERACTIONAL

TREATMENT TREATMENT TREATMENT
SALARY EMPLOYEE EMPOWERMENT APPROPRIATE AND
EQUITABLE TREATMENT OF
BONUSES ALLOWING EMPLOYEES EMPLOYEES
FOR DECISION-MAKING
GIVING THEM PROPER
BENEFITS
INFORMATION IN CRUCIAL
DECISIONS INVOLVING
THEM
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 Accountability

Refers to the obligation and

responsibility to communicate and
inform the stakeholders the
position, prospects and risks of the
Company.
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 Responsibility

This goes hand in hand with

Responsibility of business
organizations are multi-faceted.
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 Businesses . . .

must comply with are obliged to give

different regulations salaries according to should not also
imposed by both the law, commensurate neglect the
local and nation to the qualifications environment.
government of its employees.
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 Transparency

This means openness, the Company

provides to shareholders and other
stakeholders updated, clear and
honest information.
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 Stewardship

Is an ethic that embodies the responsable planning and

management of resources.
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 BENEFITS OF GOOD CORPORATE GOVERNANCE?
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Thank You
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