Which of the following best describes how corporate governance influences an organization?
A) To exert control over management.
B) To hold management accountable for its actions.
C) To exert control and require accountability for the resources entrusted to the organization.
D) To exert control over the internal control environment.

Question

Quizplus · Accepted Answer

Corporate governance is the system of rules, practices, and processes through which a company is directed and controlled. It influences an organization by exerting control over the resources entrusted to it and requiring accountability from the management. This helps in ensuring sustainable growth and development of the organization while acting in the best interest of all stakeholders. Option A and D are incorrect as they only focus on management and the internal control environment, respectively. Option B is partially correct but does not provide a comprehensive view of the impact of corporate governance.

Which of the Following Best Describes How Corporate Governance Influences