81296733 Corporate Governance in an International Context.docx

81296733 Corporate Governance in an International Context.docx

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Corporate Governance 1 Corporate Governance in an International Context Name: Course: Instructor’s Name: Date:
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Corporate Governance 2 Abstract Traditionally, vast corporate have been composed largely of the male sex from similar backgrounds, forming an “old boys’ club”, which is the ruling board meetings in most private sectors. This report tries to examine the empirical relationship between board diversity and both corporate performance and board convention procedures. The research found diversity in ethnic lines, gender and discipline of board members showed a positive correlation with TOBIN Q, a market-based measure of firm performance.
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Corporate Governance 3 Introduction Corporate institutions in several parts of the world have experienced puzzling times in the recent past. Low-quality assets in corporate ownership pinpoints what really causes the problem and have since turned toxic thus weakening their capability to perform. In addition, there is the intermediation function that erodes their capital. As a result, due to loss of confidence there has been a failure in the corporate governance. This paper shall address the empirical and theoretical literature on board in an international context with emphasis on the board of directors. The issues of diversity are the transitional phase of most literal form in the word itself hence, the term. Kahn (2002) suggest that the converting is provision an objective and a work plan indicating where differences are valued. The distinction is in relation with age, culture, gender, religion, physical appearance, personal style, and experience. The Concept of Corporate Governance Corporate governance defines the set of policies and laws affecting the system that a company uses in its administration, via instruments that tend eliminate or decrease the chief agent problem. According to The African Development Bank, corporate governance is the mechanism that frames powers and duties of corporations to bring benefits to investors and those affected directly by the corporation’s activities.
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Corporate Governance 4 Internationally, due to the essence of economic wealth of corporations and the community in general, corporate governance has engrossed a lot of interest according to Randal (2001). Maximizing the wealth of shareholder's is the major goal of many firms. Shareholders put their resources at the disposal of companies with the expectation of proper management of their resources and in a transparent manner. However, managers do not always conform to the interests of the shareholders. The Board of Directors comes in handy to monitor the activities of the board and management personnel. Role of Directors and How They Function Usually, the major role of directors is to recruit new competent executive officials and approves them, keep a close watch on the management strategy, compensate and reevaluate them, control and monitor the environment that surrounds these institutions. It also makes sure they comply to the institution regulatory and also ensure that the legal framework is executed. The performance
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