Choosing a corporate governance guide depends on the company’s goals, sector, and region. Companies should consider specialized guidance for certain industries and ensure internal procedures are rigorous. Quality and scope should also be considered when selecting a guide.
Choosing a good corporate governance guide depends on the goals of the company. Corporate governance may need to improve due to stricter regulation in a certain industry or criticism from auditors. The company may be entering a significant new market where regulations are stricter. A recent crisis may have prompted governments or regulators to take a closer look at corporate governance practices and to require higher corporate governance standards. Therefore, a corporate governance guide should be chosen based on the sector, country or region concerned and the quality of the material.
A company doing business in the United States for the first time would be strongly advised to acquire corporate governance guidance related to regulatory issues. This will allow the company to set up procedures to ensure compliance with the rules. Companies setting up operations in other countries can obtain corporate governance guides in smaller jurisdictions through organizations such as the International Chamber of Commerce.
Companies operating in certain industries may need to find more specialized corporate governance guidance. Banks, for example, have faced various corporate governance challenges following bankruptcies and scandals. A general guidance on corporate governance would not cover the very specialized issues relevant to banks and the level of risk in the financial sector. The corporate governance system must take into account the regulations and standards that apply to the specific sector.
Corporate governance is a concern not only due to increased regulation in various countries or industries. The directors of a company have a responsibility to the shareholders to ensure that the business is as efficient and profitable as possible and that an effective corporate governance framework is part of it. Directors should know that internal procedures are rigorous and will not allow difficulties to arise due to negligence or carelessness. Directors need to be confident that problems that arise will be identified and addressed by the internal controls and procedures they have in place.
The quality of the corporate governance guide should also be considered when making a selection. A guide that covers the correct country or region may not necessarily have the scope or depth your business needs. The corporate governance guide must therefore be chosen by someone in the company who already has some knowledge of the issues that should be covered by a good corporate governance guide. Taking into account the industry, the countries covered, the scope and quality of the material, the correct decision can be made.
Protect your devices with Threat Protection by NordVPN
