Corporate governance connotes the rules and regulations controlling the affairs of companies. It involves series of systematic processes and established set of standards that dictates how business institutions should operate in order to ensure that the interests of the stakeholders are adequately protected.
From my own perspective, corporate governance is nothing but a process through which the company’s administration is planned, organized, directed, coordinated and controlled. In this context, planning is an intellectual process that predominantly targets at the accomplishment of the established and desired goals of the corporate institution. Organizing involves the efforts of every individual stakeholder in actualizing the company’s objectives. In other words, it is the development of a framework that delegate responsibilities to all and sundry of the company, hence forming division of labor which is an imperative factor in producing maximum result with greater efficiency. Directing entails issuance of instructions premise on the set of criteria of the business organization. Coordinating is chiefly geared towards reconciling boundaries and disparities that militate against efficacious transformation. It is paramountly quintessential in synchronizing and harmonizing the stakeholders’ differences which assist them to work in synergism. Controlling is the regulation of activities predicated on the principles that govern the corporate affairs. It defines the limit of actions that hovers around the company’s domain.
In addition, corporate governance implies a set of laws that influences the administration of a group of company authorized to act as a single entity and acknowledged as such in the legal system. Here, the opinions of all members except none are considered cardinal and integral towards bringing far-reaching and resilient development.
Discipline: – Corporate governance trains stakeholders to strictly adhere or conform to the whims and caprices that regulate the institution.
Transparency: – It discloses both financial and non-financial processes that are run within the company to the public for scrutiny and evaluation.
Independence: – It prevents friction and mayhem that arise when large shareholders impose their undue influences on the company without regard for small shareholders.
Accountability: – It gives room to those who participate in decision making to account for their stewardship and also endows other stakeholders with the right to question their actions.
Responsibility: – It penalizes any form of mismanagement and creates the atmosphere for supervision to ensure things do not go pear-shaped.
Fairness: – It champions parity and promotes egalitarian services to both minority and majority shareholders as long as they have interest in the company and its future.
Social responsibility: – It builds the image of its members in the social setting by making them have good sense of judgment in confronting both simple and complicated issues that transpire within the human environment so as to promote justice, obliterate exploitation and stigmatization.
Government agencies and authorities
Stock exchanges
Board of directors
The chief executive officer
Community at large, etc.
RISK ASSUAGEMENT: – It mitigates or hinders forgery in recording the financial reports and accounting for the actions of the company. This incapacitates corporate scandals, fraudulent transactions and other forms of criminal activities that may grow wings in the corporate entity. It weeds shady dealing that cause shareholders and investors to abscond out of fear.
BUILDS IMAGE: – It is an image builder because it has a self-policing attribute of protecting the company’s reputation by giving it the immunity to assertively defend every activity competent to muddy its image, thus winning the hearts of investors, suppliers, etc.  with ease.
ACTIVATES ECONOMIC GROWTH: – It enables the economy to grow in leaps and bounds by fertilizing the business ground upon which the investors even at the international level transact their businesses without wave of distrust and fear, thus fortifying the economic edifice.
ATTRACTS FOREIGN INVESTORS: – It plays a crucial role in catching not just the eyes of domestic investors but also engrosses the minds of exogenous investors through exhibition of transparency, accountability and prioritization of fair justice, etc. and these principles transmit good sensation and trust into the spines of investors.
INFRASTRUCTURAL DEVELOPMENT: – Not only does it spray infrastructural growth for the individual company, it also extends its hands of development to every corner where it is situated. It performs this deliberately to add value to lives existing within the vicinity or unconsciously in its effort to attract investors. Hence, spreading social amenities like wildfire.
PROTECT STAKEHOLDERS INTEREST: – It ensures that business organization is managed in such a way to fit into the interests of all without exception. This prevents undue advantage where the dominant members claim the dividends of the company leaving little or nothing in the hands of other members who are considered marginal per say. Irrefragably, if everybody’s interests are deemed indispensable, the company is propelled to the zenith of breath-taking and sterling progress.
Irrefutably, the significance of corporate governance in corporate institutions is enormously manifold and cannot be overemphasized. Therefore, any corporate organization without a system of corporate governance is as good as a body without soul because the weight of progress recorded owing to the existence and functioning of corporate governance is too gigantic to be compared with the negligible impact attained when a company runs its affairs without corporate governance.