Business Ethics and Corporate Governance, Second Edition

PUBLIC GOVERNANCE AND CORPORATE GOVERNANCE

Governance is the exercise of authority, which involves not solely the right to direct but also to lead and to control within an organization. Two problems exist regardless of whether the organization operates within political society or within civil society:

1. How to accumulate the power and authority required to achieve the purposes of the association?
2. How to limit the power and authority to specified areas rather than to allow it to overflow into areas that are not its concern?

Although the same problems need to be addressed, governance within enterprise associations such as corporations is not at all like governance within a governmental body. Commercial activity conducted by corporations and by ...