Corporate Governance NLM Reviewer PDF

CORPORATE GOVERNANCE NLM REVIEWER Corporate governance is a system of - Second part of the CGC for PLCs that are intended to identify the specific DIRECTION...

CORPORATE GOVERNANCE NLM REVIEWER Corporate governance is a system of - Second part of the CGC for PLCs that are intended to identify the specific DIRECTION features of corporate governance good FEEDBACK practice that are recommended for companies operating according to the CONTROL Code. Using EXPLANATIONS REGULATION - Third part of the CGC for PLCs that PERFORMANCE STANDARD supplements the recommendations which aim to provide companies ETHICAL GUIDELINES information about best practices in Corporate governance is a system of direction, corporate governance feedback, and control using regulations, CONCLUSIONS ? performance standards, and ethical guidelines, to hold the company's Board and senior management accountable for ensuring ethical behavior to the benefit of all TRANSPARENCY stakeholders and society. - freely available and directly accessible to those who will be affected by such LAWS decisions and enforcement. - The public should, therefore, have a right ACCOUNTABILITY to expect laws, a fair judicial system, - Decision-makers must be accountable to politically accountable lawmaking, and the public, as well as to organizational active and reform-minded bureaucracy stakeholders. - Impartial enforcement of laws requires an independent judiciary and an RESPONSIVENESS impartial and incorruptible police force - serve all stakeholders within a - Ensure that the corporation complies reasonable timeframe or appropriate with all relevant laws, regulations, and manner to protect the interest of all codes of best business practices - Responsible(board) for coordinating, SUSTAINABILITY monitoring and facilitating compliance - doing business without negatively with existing laws, rules and regulations affecting or impacting the environment, community or society as a whole. PRINCIPLES - Managing the business to ensure long- term survival, while creating long term - First part of the CGC for PLCs that high- value by considering ecological, social level statements of corporate and economic environments; long-term governance good practice that apply to viability and competitiveness all companies. EQUITY (and inclusiveness) originally equity lang RECOMMENDATIONS  CORPORATE GOVERNANCE NLM REVIEWER - The organization must ensure that all its - act with honesty and consistency and to members feel they have a stake in it and hold yourself accountable for your do not feel excluded actions, even when nobody's watching. - requires, all groups, but particularly the A director (board) should exercise most vulnerable, have opportunities to leadership, prudence, and integrity in improve or maintain their well-being directing the corporation towards CONSENSUS-ORIENTED sustained progress over the long term - organization mediates differing interests to reach a broad consensus on what is in TRUST AND CONFIDENCE the best interests of the group, and - A director's office is one of trust and where possible, on policies and confidence. procedures VISION RULE OF LAW - A company dream highlighting the grand - requires full protection of human rights, value or change the company hopes to particularly those minorities. Impartial contribute to the world encompassing a enforcement of laws requires an company’s core value independent judiciary and an impartial and incorruptible police force. MISSION EFFECTIVENESS/EFFICIENCY - Concrete business objective of an organization and how to achieve the - processes and organizations must same; what is the company doing now, produce results that meet needs while an embodiment of what it stands for, making the best use of resources who for and how it is accomplished FAIRNESS STRATEGIC OBJECTIVES - impartiality; treating people equally - high-level and measurable goals (equity) outlining what an organization wants to A director should act in the best interest achieve, with a clearly defined deadline; of the corporation in a manner purpose statement that help create an characterized by transparency, overall vision and set goals and measure accountability, and fairness. steps to achieve desired outcome. To ensure good governance of the PRUDENCE corporation, the Board should establish the corporation's VISION and MISSION, - caution in practical affairs, discretion or STRATEGIC OBJECTIVES, policies, and circumspect procedures to attain corporate GOALS AND OBJECTIVES, while monitoring and INTEGRITY overseeing management action. - probity (honesty)  CORPORATE GOVERNANCE NLM REVIEWER EXECUTIVE DIRECTOR - the ultimate champion of Enterprise Risk Management (ERM) and has adequate - A director who is at the same time authority, stature, resources and support appointed to head a department/unit of to fulfill his/her responsibilities, subject the company to a company’s size, risk profile and NON-EXECUTIVE DIRECTOR complexity of operations. - A director who is not an employee of the PRE-EMPTIVE RIGHT company - right to buy additional shares to INDEPENDENT DIRECTOR maintain his proportionate share in the company - A director who should always be present in all of the committees formed by the STOCKHOLDERS BOD, not an employee nor relative of an - someone who has shares in a company. employee/director of the company, an Stockholders own a piece of that owner of not more than 10% of company company. stocks STAKEHOLDERS PARTICIPATION - who have an interest in the company and - All men and women should have a voice are directly affected by its operations in decision-making, either directly or through a legitimate intermediate PROXY organization that represents their - person holding authority to act for interests. another - Such broad participation is built on freedom of association and speech, as RELEVANCE well as capacities to participate constructively. - how helpful the information is for financial decision-making processes. INTERNAL CONTROL AND ITS AIMS All items that are RELEVANT and MATERIAL - 1. Safeguard Assets should be disclosed to readers of FS; - 2. Reliability of the entity’s financial concerned with decision making. reporting DISCLOSURE - 3. Effectiveness and efficiency of - transparency is attained through this, operations which is one of the generally accepted - 4. Compliance with applicable laws and accounting principle. regulations RISK MANAGEMENT IMPACT - systematic approach in identifying, - Sustainability is responsible for the analyzing, and controlling areas or impact that the organization exerts on its events with the potential for unwanted surroundings, in business, change or harm of the company environmental and social terms. CHIEF RISK OFFICER  CORPORATE GOVERNANCE NLM REVIEWER - Conscious management of the impact for your business or even a specific translates into lower costs, improved project external relations, and better-managed risks. CORPORATE SOCIAL RESPONSIBILITY ECONOMICS - a self-regulating business model that - Sustainability is a skilled positioning of helps a company be socially accountable the organization in the economic – to itself, its stakeholders, and the reality, taking account of the social and public. economic challenges, environmental - By practicing corporate social opportunities, and threats. responsibility, also called corporate - The awareness that the organization citizenship, companies can be conscious functions within a broader framework, of the kind of impact they are having on amid complex interrelations with many all aspects of society, including stakeholder groups, allows it to get ready economic, social, and environmental. and make use of the opportunities linked with sustainability. The SEC approves this to raise Corporate INDUSTRIAL RELATIONS Governance for publicly-listed companies adopts this approach - Sustainability is the awareness that stakeholders surround the entity. - Code of CG for publicly-listed - Building and cultivating good relations companies with stakeholders based on engagement The Code of CG for publicly-listed adopts this and dialogue is crucial because it not approach only affects the possibilities to manage risks but also supports the development - comply and explain approach and gives the organization a competitive edge. CORE VALUES - deeply ingrained principles that guide all employees of a company’s actions. - These values serve as the company’s cultural cornerstones that can never be compromised, either for convenience or short-term economic gain. SWOT ANALYSIS - Assess organizational skills - The key is to list your core competencies that the company is most passionate about sharing - a technique used to identify strengths, weaknesses, opportunities, and threats