Is Reforming the Corporate Governance System Necessary?

Abstract

Due to lax corporate governance practices over the past few decades, fraud has both increased in severity and frequency. The goal of this research is to improve current governance systems to help businesses deal with issues in the global corporate environment. For a public company to succeed, it needs a solid corporate governance system. It is critical to establish appropriate transparency guidelines and procedures. Reforms are required to address existing issues and improve global corporate governance in the following ways: a. The audit committee must monitor and enforce financial and disciplinary matters; b. The board structure must be balanced; c. Continuous disclosure must be prioritized; d. CFOs and CEOs must be held explicitly accountable for their actions; e. The selective mechanism must be completed; and f. The auditor's role must be changed from that of a watchdog to that of a whistleblower.