Corporate Governance and Operational Effectiveness

This assignment delves into the significance of corporate governance in driving operational effectiveness. It highlights the various stakeholders involved, including employees, suppliers, customers, board of directors, external auditors, finance market, media, government, and societal influences. The document also touches on the importance of transparency and accountability in achieving financial health and stability.

CORPORATE
GOVERNANCE

TABLE OF CONTENTS
PART 1............................................................................................................................................1
Scope of corporate governance....................................................................................................1
Extent of business governance.....................................................................................................1
Changes recommended................................................................................................................2
1b. Developing the diagram with another entity.........................................................................2
PART 2............................................................................................................................................3
2. American rule-based model vs UK/ Commonwealth Principles- Based model......................3
REFERENCES................................................................................................................................5

PART 1
1a.
Scope of corporate governance
Defining the adequate conceptual framework which would be adequate for the business in
relation with designing the work-based structure, defining roles and responsibilities to employees
as well as communicating effective ascertainment of the operational practices. The scope of
corporate governance defines number of shareholders, board of directors, financial professionals,
regulatory authority, consumers and suppliers (Aguilera, Judge and Terjesen, 2018). Thus,
managing the operations of business with considering managing all units and areas of operations
which could be adequate for the firm in retaining the effective market share. However, there
have been several benefits which would be effective for business to adopt the corporate
governance such as:
 There have been ensured of having the adequate success and economic growth of entity.
 There will be positive impact on share prices of firm.
 It will be helpful in brand formation and development.
Extent of business governance
As per considering the diagram on which it can be said that there have been several
loopholes which are affecting the operational motives of the firm. There must be less influences
from the external sources such as societal influences, government and Media. Thus, in relation
with such outcomes on which it can be said that there have been impacts of such factors in
distracting the operational motives for the business (Mutlu and et.al., 2018). The influences will
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only be required here is for managing the operational tactics and principles to make qualitative
governance of the operations. Another variation is that, there must be effective financial control
such as instead of hiring the external auditor firm must have financial professionals such as
accountant, auditors etc. which would have daily analysis and bring various changes in the
operational practices of the firm.
Changes recommended
In relation with loopholes on which it has been suggested that there must be effective
changes in several parts. Thus, bringing the adequate corporate governance into practices will be
effective in succeeding the firm for retaining the better market share. In relation with improving
the operational aspects and managing the firm’s financial health which requires a business must
have transportation, accurate and clear disclosure of results (Anginer and et.al., 2018).
Disclosing financial health would be effective in leading the market operations as well as
managing the teams in relation to meet the gains at right time. Thus, management of operations
will be effective in terms of meeting the business targets at the right time.
 There must be transparency in presenting the financial disclosure which would be
effective in communicating the accurate and reliable information among the society.
 There must be construction of the structures and strong board committee which would
analyse the business problems and make effective decision in governing the business.
 There has been requirement for developing the roles and responsibilities for governance
authorities
 There must be proper consideration over controlling the risks and managing as per
meeting the targeted aims.
1b. Developing the diagram with another entity
Corporate governance model for the non-for profit organisations.
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PART 2
2. American rule-based model vs UK/ Commonwealth Principles- Based model.
In accordance with analysing the American rule-based model and UK/ Commonwealth
principle-based model on which making the adequate analysis would be effective in overcoming
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Stock market for
listed companies
Market intermediaries
Voluntary investors
Board of
directors
Management
Contractual stakeholder’s
employees, supplier’s customers
etc.
External
auditors
Societal
influences and
other stakeholders
Government and
other corporate
regulators
Media
Finance market equity and
debt

with the challenges. However, these models were developed with the motive to bring
information and knowledge among society in relation with managing an effective corporate
governance. However, to have better understanding regarding the functional aspects of these
models it has been discussed below such as:
American rule-based model: There have been impacts of various kinds of ownership
which are fundamentally affecting the power of board committee. Therefore, there have been
freedom to the wide spread shareholders stated in world. There have been block of investors
which comparatively have less freedom of operations (Black and et.al., 2018). It defines ramjet
for effective corporate control on which there have been higher proportion of external investors.
In accordance with the operational motives of the organisation on which analysing the business
aspect that have defined low proportion of external investors. Moreover, it can be said that in this
aspect there has been less freedom awarded to the investors to make investment in the business.
UK/ Commonwealth Principles- Based model: this model defines the management of
operations will be done through changing the powers. Thus, bring reforms in the operational
structure such as allocating power bringing legislative influences will be adequate in managing
and monitoring the organizational aspects. There have been achievement of various goals,
legislations, rules and regulations which would impacting on developing the favorable corporate
governance into practice (Reassessing the new Commonwealth model of constitutionalism,
2010). Therefore, it is being required that there must be appropriate management of operations
on which managing the business by balancing the goals of firm will be adequate in monitoring
the overall work culture.
In relation with analysing the operational practices of the organisation on which making
adequate determination of the operational values and governance would be effective in leading
the team to appropriate goal achievements. There could be development of operations by
implicating various challenges. There has been various accounting financial standard which are
being stated in the environment which are aiming tat bringing the transparency in the outcomes.
Thus, every organisation must reflect the adequate analysis over the data base through which
they could manage financial health of the organisation. Thus, corporate governance on the other
hand will be effectives as if there could be adequate management of operational practices such as
making the reliable operational changes which would result in developing standards, qualified
framework as well as motivate employees in a positive manner.
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REFERENCES
Books and Journals
Aguilera, R. V., Judge, W. Q. and Terjesen, S. A., 2018. Corporate governance
deviance. Academy of Management Review. 43(1). pp.87-109.
Anginer, D. and et.al., 2018. Corporate governance of banks and financial stability. Journal of
Financial Economics. 130(2). pp.327-346.
Black, B. S. and et.al., 2018. Which Aspects of Corporate Governance Matter in Emerging
Markets: Evidence from Brazil, India, Korea, and Turkey. Northwestern Law & Econ
Research Paper, (14-22).
Mutlu, C. C. and et.al., 2018. Corporate Governance in China: A Meta‐Analysis. Journal of
Management Studies. 55(6). pp.943-979.c
Online
Reassessing the new Commonwealth model of constitutionalism. 2010. [Online]. Available
through :< https://academic.oup.com/icon/article/8/2/167/700011>.
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