Best practice corporate governance provides a structure that benefits the shareholders, the board of directors, executive management, employees, and customers by ensuring that the organization follows the highest ethical standards as well as formal laws and regulations.
The key components of sound corporate governance practices are based on honesty, integrity, responsibility, and an unwavering commitment to the corporation.
Corporate governance practices involve operational and legal procedures that balance the relationship between a corporation and its shareholders, the board of directors, executive team, employees, and customers. These practices address issues including the composition of the board of directors, corporate auditing guidelines, risk mitigation, as well as director and executive management code of conduct.
Over the last decade, corporate governance practices have been under government scrutiny as corporate directors and officers have committed unethical or illegal acts by abusing their power. To prevent the abuse of corporate power, directors and executive management must establish and adhere to a code of conduct when disclosing financial reports and managing conflicts of interest.
Widely accepted corporate governance principles include:
- Shareholder rights and treatment – Corporations must respect shareholder rights by communicating relevant information by encouraging them to attend and participate in board and committee meetings.
- Stakeholder interests – Corporations must acknowledge the legal obligations they have to all stakeholders.
- Responsibilities of the board and executive management – The board and executive management must possess a wide variety of skills and knowledge to address complex business issues.
- Ethical behavior – Corporations must develop and implement a code of ethical conduct and decision making that executive management and directors must follow.
- Full disclosure and transparency – Corporations must disclose the roles and responsibilities of directors and executive management as well as ensure that all investors have access to factual financial reports.
Alliance Advisors has the experience and knowledge to assist corporations in the creation, implementation, and execution of corporate governance principles that guide directors and officers through the complex and challenging business landscape. We offer customized solutions and can assist you with the following:
- Provide training to the board and executive management on good corporate governance
- Evaluate existing governance practices and/or create a new corporate governance model
- Assess the roles and responsibilities of senior management and the board
- Provide assistance to the board in the development of ethical codes of conduct
- Make recommendations to improve governance profile based on the latest topics that are relevant to your particular shareholder base