CHAPTER 3

Fundamentals of Corporate Governance

Introduction

Public companies are a major engine of economic growth and prosperity in a free enterprise system in advanced capitalist economies, such as the United States. Shareholders who invest capital are usually remote, by distance or by knowledge, from those managing a corporation. The wave of financial scandals of the late 1990s and early 2000s and the global financial crises of 2007–2009 were devastating and resulted in billions of dollars in financial losses and the erosion of investor confidence and public trust in financial reports disseminated by public companies. Financial scandals of high-profile companies such as Enron, WorldCom, Global Crossing, and Qwest (better known as the Big-Four ...

Get African American Entrepreneurs now with O’Reilly online learning.

O’Reilly members experience live online training, plus books, videos, and digital content from 200+ publishers.