INTRODUCTION

Corporate governance is the set of processes, customs, policies, laws and

institutions affecting the way a corporation is directed, administered or controlled.
Corporate governance also includes the relationships among the many stakeholders
involved and the goals for which the corporation is governed. The principal
stakeholders are the shareholders, management and the board of directors. Other
stakeholders include employees, suppliers, customers, banks and other lenders,
regulators, the environment and the community at large.

Corporate governance is a multi-faceted subject. An important part of corporate

governance deals with accountability, fiduciary duty, disclosure to shareholders
and others, and mechanism of auditing and control. In this sense, corporate
governance players should comply with codes to the overall good of all
constituents. Another important focus is economic efficiency, both within the
corporations ( such as the best practice guidelines) as well as externally (national
institutional frameworks ). In this” economic view, the corporate governance
system should be designed in such a way as to optimize results, as well as to detect
and prevent frauds. Some argue that the firm should act not only in the interest of
the shareholders but also off all the other stakeholders.

Governance makes decisions that the define expectations, grant power, or verify
performance. It consists either of a separate process or of a specific part of the
management or leadership processes. Sometimes people setup a government to
administer these processes and systems. In the case of a business or a non profit
organization, governance develops and manages consistent, cohesive policies,
processes and decision-rights for a given area of responsibility. For example,
managing at a corporate level might involve evolvic policies on privacy, on
internal investment, and on the use of data.