Business Ethics and Corporate Governance, Second Edition

SUMMARY

Corporate governance is typically perceived by academic literature as dealing with ‘problems that result from the separation of ownership and control’. Sir Adrian Cadbury, Chairman of the Cadbury Committee defined the concept as ‘holding the balance between economic and social goals and between individual and communal goals’. Experts at OECD have defined corporate governance as ‘the system by which business corporations are directed and controlled’. All these definitions capture some of the most important concerns of governments in particular and the society in general. These are (i) management accountability; (ii) providing adequate investments to management; (iii) disciplining and replacement of bad management; (iv) enhancing corporate ...