The governance profession PDF Print E-mail

"At its simplest level corporate governance can be described as the system by which organisations are directed and controlled." 
- Sir Adrian Cadbury (UK, Commission Report: Corporate Governance 1992)

"Good corporate governance is about 'intellectual honesty' and not just sticking to rules and regulations … capital flows towards companies that practice this type of good governance." 
- Mervyn King (Chairman: King Report)


Corporate governance such as outlined in King II and King III has certain inherent basic principles which ensure proper business management including:

  • Sound corporate practices
  • Accountability
  • Sustainability
  • Transparency

 

What is Corporate Governance?

Corporate governance is a multi-disciplinary business imperative, which can be broken down into discrete components including:

  • Sound business processes, procedures and policies to mitigate risk and ensure optimum operational activities;
  • Effective asset management within the confines of regulatory, compliance and risk constraints and risk management principles;
  • Management commitment to conduct that is universally recognised and accepted as sound and proper;
  • Board responsibility for sound business practices and risk management;
  • Focus on non-financial business aspects;
  • Social responsibility and economic empowerment initiatives;
  • Internal audit monitoring and review of internal controls designed to mitigate real, potential and future risks;
  • Promotion of commercial longevity and profitability;
  • Business continuity and disaster recovery; and
  • Compliance and enforcement.