POLYTECHNIC UNIVERSITY OF THE

PHILIPPINES
COLLEGE OF ACCOUNTANCY AND FINANCE

ACCO20163
GOVERNANCE, BUSINESS ETHICS, RISKS
MANAGEMENT AND INTERNAL CONTROL

Module 02: Corporate Governance

MCA, 2020
Module 02: Corporate Governance

Overview
 
 Definition of Corporate Governance
 Theories of Corporate Governance
 Defining Stakeholders
 Corporate Ethics and Accountability
 Corporate Governance in the Philippines
 Corporate Governance Code of 2016
 G20 OECD Principles of Corporate Governance
Module 02: Corporate Governance

Definition of Corporate Governance

 The framework of rules, systems and processes in the corporation that
governs the performance by the Board of Directors and Management of
their respective duties and responsibilities to the stockholders.

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corporate-governance-and-its-basic-principles-152.png
Module 02: Corporate Governance

Theories of Corporate Governance

Module 02: Corporate Governance

Stakeholders
 A stakeholder is a party that has an
interest in a company and can either
affect or be affected by the business.
The primary stakeholders in a typical
corporation are its investors,
employees, customers and suppliers.

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older_%28en%29.svg/1200px-Stakeholder_%28en%29.svg.png
Module 02: Corporate Governance

Corporate Ethics and Accountability

 Corporate ethics and accountability maintains that businesses should be
held responsible for the impact of their actions on society and the
environment.
Module 02: Corporate Governance

Corporate Governance in the Philippines

The Asian Philippine SEC
Long before the Crisis in issued MC2-2002, Philippine SEC issued
collapse of Enron and 1997 was Code of Corporate MC6-2009, Revised The 2016 CG Code
WorldCom, the attributed to a Governance. This Code of Corporate embodies all the
Philippines had its failure of aims to promote Governance. The govt, Revised the needed provisions
own share of corporate corporate corporate governance acting in the public definition of CG
aligned with the
scandals like BW governance reforms that will raise interest, regulates to restore the
in 5 investor confidence, companies to prevent role of
ASEAN Corporate
Resource Corporation,
whose share prices hit countries, develop capital malpractice and to stakeholders w/c Governance initiatives
record high and then incl the market and sustained promote the dev’t of was removed in and many global best
collapsed in 1999. Philippines. growth. markets. 2009. practices.

1990 1997 2002 2009 2014 2016

Module 02: Corporate Governance

Corporate Governance Code of 2016

Key Elements:
 The Principle of “Comply or Explain”
 16 Principles and 67 Recommendations
 16 Principles follows updated principles of Corporate Governance as
revised by the Organization for Economic Cooperation and Development
(OECD).
Module 02: Corporate Governance

Corporate Governance Code of 2016

5 Corporate Governance Themes:
 The Board’s governance responsibilities
 Disclosure and transparency
 Internal control system and risk management framework
 Cultivating synergic relationships with shareholders
 Duties to stakeholders
Module 02: Corporate Governance

G20 OECD Principles of Corporate Governance

 Ensuring the basis for an effective corporate governance
framework.
 The rights and equitable treatment of shareholders and key
ownership functions.
 Institutional investors, stock markets and other intermediaries.
 The role of stakeholders in corporate governance.
 Disclosure and transparency.
 The responsibilities of the Board.
Module 02: Corporate Governance

QUIZ 02
Not less than 1,000 words. Accomplish this in a doc file with file name “QUIZ
02_SURNAME FIRST NAME”, and upload in your pre-designated google drive path.

Make a comparative summary of the corporate governance structure of one

Philippine company and one foreign company, following below format:
I. Introduction Company Company
II. Comparative Analysis A B
II. Comparative Analysis (see table for
reference) A. Business Background
III. Recommendation for Improvement B. Financial analysis for
IV. Conclusion the last 3 years
C. Compliance with Six
G20 OECD Principles