HC 12

Question 1

Corporate governance perspectives

Answer 1

• Operational perspective
• Corporate governance is the process by which companies are directed and controlled
• Financial Economics perspective
• Corporate governance deals with the way suppliers of finance assure themselves of getting a return on their investment
• Relationship perspective
• The relationship among various participants in determining the direction and performance of corporations. The primary participants are the stakeholders, the
  management and the board of directors
• Stakeholders’ perspective
• Corporate governance is the process by which corporations are made responsive to the rights and wishes of stakeholders
• Societal perspective
• Corporate governance is concerned with holding the balance between economic and social goals and between individual and communal goals.