10Club Theory and Directors’ Performance Evaluation
Introduction
Directors’ performance evaluation is a critical component of a regulatory framework for corporate governance (OECD, 2015a, p. 53). The G20/OECD Principles of Corporate Governance (OECD, 2015a, p. 9) underscore this by stating that corporate governance “provides the structure through which the objectives of the company are set, and the means of attaining those objectives and monitoring performance are determined.” Performance evaluation promotes directors’ accountability by clarifying their roles and responsibilities and providing relevant information for stakeholder decisions. It can lead to improved directors’ effectiveness by communicating performance expectations, ...
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