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Source:OECD 2010,Corporate Governance and the Financial Crisis: Conclusions and Emerging GoodPractices to Enhance Implementation of the Principles, accessed October 2015,.There is no imperative statement by the OECD that the chair should not also be the CEO.The fact that, in many US corporations, ‘presidents’ are the chair and the CEO at the same timeis perhaps an influencing factor in the OECD conclusions. However, it seems that this policy isslowly achieving traction even in the United States. As noted earlier, there is a gradual trendin S&P 500 companies in the United States towards separating the roles of chair and CEO.Nonetheless, the importance of independence, or independence protocols, is clearly identifiedin the United States in Sarbanes–Oxley and in other governance systems principles.Continued evolution of corporate governanceThis brief discussion of potential improvements to corporate governance shows that it is aconstantly evolving process rather than something that has already been finalised and perfected.There are many more opportunities for improvement that hopefully will limit the effect ofeconomic downturns in the future and improve the performance of organisations.
W:\CPA-Production\CPA Course Material\CPA 118 E&G_2nd edition\E&G-Module-03\147537_eg_m03_2nd-edn_140218.inddDTP: Mira1-PP2nd edn08-03-18MODULE 3258|GOVERNANCE CONCEPTSReviewThis module explored the importance of having clear principles in place for guiding organisationsto achieve their objectives while conforming to expected business behaviour and rules.It included explanations of how governance is the way in which organisations are directedand controlled, and how the various stakeholders actually perform their governance roles.Directors, with their relevant duties and obligations, have the greatest role in governance,and also the power to have the most impact, both positively and negatively, on the organisation.Shareholders, auditors and regulators all have roles to play to ensure that problems are quicklyidentified and rectified, and to help organisations pursue their goals and objectives appropriatelyand successfully.After considering the development of corporate governance best practice over the past 30 years,the module focused specifically on best practice principles as outlined in the OECD Principles,the FRC Code and the ASX Principles. This included a detailed review of specific items that havebeen recommended as helpful or essential for ensuring good governance in both corporate andnon-corporate sectors.We then looked in more detail at the non-corporate sector (including family-owned businessesand SMEs, not-for-profit organisations and the public sector), discussing some of theircharacteristics and their significance to the economy.

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Business Ethics, Accountant, CPA Australia, Ethics and Governance

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