Ethics and Corporate Governance..
DEFINING GOOD GOVERNANCE
THE CHARACTERISTICS OF GOOD GOVERNANCE
NINE PILLARS – CORPORATE GOVERNANCE CODE FOR SMALL AND MEDIUM SIZED ENTERPRISES
FIVE STEPS TO IMPROVE CORPORATE GOVERNANCE
Why is good governance important?
2. Topics
DEFINING GOOD GOVERNANCE
THE CHARACTERISTICS OF GOOD GOVERNANCE
NINE PILLARS – CORPORATE GOVERNANCE CODE FOR SMALL
AND MEDIUM SIZED ENTERPRISES
FIVE STEPS TO IMPROVE CORPORATE GOVERNANCE
3. Defining Good Governance
Governance is "the process of decision-making and the process
by which decisions are implemented".
Good governance is at the heart of any successful business. It is
essential for a company or organization to achieve its
objectives and drive improvement, as well as maintain legal
and ethical standing in the eyes of shareholders, regulators and
the wider community.
Why is good governance important?
4. THE CHARACTERISTICS OF GOOD GOVERNANCE
Good governance has 8 major characteristics. It assures that corruption is minimized, the views of
minorities are taken into account and that the voices of the most vulnerable in society are heard in
decision-making. It is also responsive to the present and future needs of society.
Clear Strategies
Discipline
Transparency
Social Responsibility
Risk Management
Continuous Self Evaluation
Protection of Share holder’s Right
More Power to CEO
Accountability
5. NINE PILLARS – CORPORATE GOVERNANCE CODE FOR SMALL AND MEDIUM SIZED ENTERPRISES
Pillar 1: Adopt a formal corporate governance framework outlining the roles of the key bodies such as
partners, shareholders, board of directors and management
Pillar 2: Conduct a succession planning process
Pillar 3: Establish a timely, open and transparent flow of information with shareholders
Pillar 4: Endeavor to set up a formal Board of Directors to accompany the growth of the company
Pillar 5: Develop a clear mandate for its Board of Directors to oversee the operational performance of
the business as well as evaluating and improving business strategies
6. NINE PILLARS – CORPORATE GOVERNANCE CODE FOR SMALL AND MEDIUM SIZED ENTERPRISES
Pillar 6: Maintain credible books of accounts, which are annually audited by an external auditor
Pillar 7: Set up an internal control framework in place and conduct a regular review of risk
Pillar 8: Recognize the needs of stakeholders
Pillar 9: Formulate a framework setting out the family’s relationship with the business
7. SUGGESTION TO IMPROVE CORPORATE GOVERNANCE
Companies need to improve corporate governance. in the absence of effective governance,
companies will suffer financial, legal and reputational harm. From the risk perspective, there is no
greater risk to a company than poor governance.
To improve, governance, here are five basic steps:
Increase Diversity
Appoint Competent Board Members
Ensure Timely Information
Prioritize Risk Management
Evaluate Board Performance
8. SUGGESTION TO IMPROVE CORPORATE GOVERNANCE
Increase Diversity
Appoint Competent Board Members
Ensure Timely Information
Prioritize Risk Management
Evaluate Board Performance