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Corporate Governance - Coggle Diagram
Corporate Governance
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Market regulation
To produce, prevent or modify a particular outcome, managing the conflict between maximising profit and the interests of those using the product/service
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Inappropriate regulation is shown to make firms less likely to innovate and adapt the quality and mix of products offered to changing customer needs
Organisation for Economic Co-operation & Development OECD and other global nations have devised ways that enable minimal cross border disruption for transactions due to differences in regulation
Increasingly global market, investment, and technology create need for co-ordination both for multinational firms but also national government/trade association at a higher level
Primary reason for corporate governance is to protect stakeholders, reminding directors of the limitations of their power and to enforce the primary agency rule - directors work on behalf of stakeholders