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Corporate governance models - Coggle Diagram
Corporate governance models
The Shareholder model
Stakeholders involved:
Shareholder/investors: The primary investors that seek returns on their investments
Board of directors: The group of people selected to protect the interests of the shareholder
Managers/Executives: The people responsible for day-to-day operations
Employees: May be affected by policies that are changed
Regulators: Individuals involved with making sure that laws are complied with.
Primarily emphasizes and focuses on the interests of the shareholders.
The Stakeholder model
Seek to balance the interest of all stakeholders and not just the Shareholders
Stakeholders involved:
Shareholders/Investors: The stakeholders that own the company and seek a return on their investment
Employees: Welfare and job security of the employees are considered in the decision making
Customers: The company is focused on cost effective ways to give the best quality products
Suppliers: The company stay focused on maintaining string ethical relationships with their suppliers
Communities: The company focusses on what the environmental impact is.
The Agency module
This module focusses on the relationship between the stakeholders (Principles) and management ( Agents) within the company.
Stakeholders involved:
Shareholder/ investors (Principles): They delegate their decision making to management
Managers / Executives (Agents): They act on behalf of shareholders but have different incentives or goals