ST.

PAUL UNIVERSITY MANILA

COLLEGE OF BUSINESS AND MANAGEMENT
ACCOUNTANCY PROGRAM





An Assessment of Corporate Governance
Best Practices







SUBMITTED BY: MICA S. ALNOOH
SUBMITTED TO: Prof. Ariel D. Pineda
COURSE: BSFMA-4
DATE: September 5, 2014
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Introduction:

Corporate Governance is defined as the system of rules, practices and
processes by which a company is directed and controlled. Corporate governance
is essentially involves balancing the interests of the many stakeholders in a
company - these include its shareholders, management, customers, suppliers,
financiers, government and the community. Since corporate governance also
provides the framework for attaining a company's objectives, it encompasses
practically every scope of management, from action plans and internal controls to
performance measurement and corporate disclosure.










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Corporate governance best practices

Corporate governance best practices offer guidelines for board members to be
most effective in bringing strategic values to their organizations. Board
chairpersons and members help ensure the board plays a key role in their
companys success when they develop strong understanding of, and successfully
implement, corporate governance best practices.
While there is no definitive set of corporate governance best practices, here is a
quick overview in four broad categories.
1. Coherent business direction
To provide a successful leadership structure, boards and company management
need to set clear, common goals and move in the same direction. Corporate
governance best practices formally establish goals, ensure support by top levels
of management and board, and clearly communicate to stakeholders. Corporate
governance best practices designed to ensure coherent business direction that
will eliminate inefficiencies and ensure the confidence of stakeholders including
shareholders, employees and customers.
2. Strategy
Coherent goals are useless if no thought is put into getting there. The board can
help a company reach its goals by ensuring effective strategy through corporate
governance best practices. Questions to ask include:
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Are corporate governance strategies aligned with stated goals?
Are appropriate resources available to implement corporate best practices?
Do strategies account correctly for the internal and external environment,
including obstacles and opportunities?
How is risk managed?
Is the corporate structure suitable to best practice strategies?
Corporate best practices should be implemented through formal processes and
then continually evaluated against pre-determined indicators. Finally, transparent
reporting is necessary for stakeholder trust and legal requirements.
3. Corporate responsibility
The global business world of today isnt just business governments, NGOs and
other non-business players affect your operations too. Responsible business
growing your business while accounting for environmental, political and social
impact is good business. Corporate governance best practices that address
corporate responsibility and sustainable business development will help secure
your businesss long-term future and make your company a part of solutions to
pressing human challenges.
4. Accountability
The board is responsible to ensure the accountability of a business. Corporate
governance best practices can help boards develop and ensure transparent
reporting procedures. This includes:
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Use of performance metrics
Clear communication to stakeholders
Conflict mitigation strategies
Ensuring fulfillment of regulatory, compliance and disclosure requirements
Naturally, your accountability and regulatory landscape will vary according to
your businesss field of activity, but you can ensure your accountability and
transparency measures are irreproachable by adhering to corporate governance
best practices.


Money companies implement the Five Golden Rules of best corporate
governance practices which are:
1. Ethics: a clearly ethical basis to the business
2. Align Business Goals: appropriate goals, arrived at through the creation of
a suitable stakeholder decision making model
3. Strategic management: an effective strategy process which incorporates
stakeholder value
4. Organization: an organization suitably structured to effect good corporate
governance
5. Reporting: reporting systems structured to provide transparency and
accountability
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As a successful example of corporate governance practice is San Miguel
Corporation where they have a clear Manual of Corporate Governance which
covers their corporate goals.
1. Objective
2. Compliance System
3. Communication Process
4. Reportorial or Disclosure System of Companys Corporate Governance
Policies
5. Shareholders Benefit
6. Monitoring And Assessment
7. Penalties For Non-Compliance With The Manual








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Conclusion

As a conclusion following the guide lines mentioned above will ensure that the
corporation will create and apply the best corporate governance practices that will
guarantee the continuation of their operations for a long term. Also it will ensure their
reporting transparency and compliance to the regulatory requirements.
















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References

1. http://www.applied-corporate-governance.com/best-corporate-
governance-practice.html
2. http://www.sanmiguel.com.ph/corporate/page/29/Manual_of_corporat
e_governance.html
3. http://www.imd.org/business-school/hpb/corporate-governance-best-
practices.html
4. http://www.investopedia.com/terms/c/corporategovernance.asp