CORPORATION

AND CORPORATE
GOVERNANCE
WHAT IS CORPORATION?
• A CORPORATION IS AN ARTIFICIAL BEING
CREATED BY OPERATIONS OF LAW, HAVING
THE RIGHT OF SUCCESSION AND THE
POWERS, ATTRIBUTES AND PROPERTIES
EXPRESSLY AUTHORIZED BY THE LAW OR
INCIDENT TO IT’S EXISTENCE.
•ARTIFICIAL BEING
•CREATED BY OPERATION OF LAW
•RIGHT OF SUCCESSION
•POWER’S, ATTRIBUTES AND
PROPERTIES
STAKEHOLDERS
OF A
CORPORATIONS
MANAGEMENT
CREDITORS
SHAREHOLDERS
EMPLOYEES
CLIENTS
GOVERNMENT
PUBLIC
PURPOSES OF A CORPORATION

• EARLY STAGE
SURVIVAL
• TO INCREASE PROFIT
BOARD OF DIRECTORS
• DUTIES OF THE BOARD OF DIRECTORS
• GOVERNING THE ORGANIZATION BY ESTABLISHING
BROAD POLICIES AND OBJECTIVES
• SELECTING, APPOINTING, SUPPORTINGAND
REVIEWING THE PERFORMANCE OF THE CHIEF
EXECUTIVE
• ENSURING THE AVAILABILITY OF ADEQUATE
FINANCIAL RESOURCES
• APPROVING ANNUAL BUDGETS
• ACCOUNTING TO THE STAKEHOLDERS THE
ORGANIZATIONS PERFORMANCE.
MULTINATIONAL CORPORATIONS
(MNC)
• HAVE INVESTMENT IN OTHER COUNTRIES, BUT
DO NOT HAVE COORDINATED PRODUCT
OFFERINGS IN EACH COUNTRY.
TRANSNATIONAL CORPORATION
(TNC)
• HAS BEEN TECHNICALLY DEFINED BY TRHE UNITED
NATIONS COMMISSIONS ON TRANSNATIONAL
CORPORATIONS AND INVESTMENT AS ‘’ENTERPRISE
WHICH OWN OR CONTROL PRODUCTION OR
SERVICE FACILITIES OUTSIDE THE COUNTRY IN
WHICH THEY ARE BASED’’.
 CORPORATE
GOVERNANCE
WHAT IS CORPORATE GOVERNANCE

• “Corporate governance is the process and structure used

to direct and manage the business and affairs of the
company towards enhancing business prosperity and
corporate accountability with the ultimate objective of
realizing long term shareholder value, whilst taking account
the interests of other stakeholders”
FUNDAMENTAL OBJECTIVES OF
CORPORATE GOVERNANCE
• IMPROVEMENT OF
SHAREHOLDER VALUE

• CONSCIOUS CONSIDERATION
OF THE INTEREST OF OTHER
STAKEHOLDERS
WHAT GOOD GOVERNANCE
PROMOTES

• TRANSPARENCY

• ACCOUNTABILITY

• PRUDENCE