Corporate Governance and Protection of Stakeholders Rights and Interests

Abstract

The paper takes a holistic view of corporate governance (CG) and protection of stakeholders’ rights and interests. It analyzes whether effective boards of directors in addressing shareholders’ interests prove to be effective in guaranteeing the interests of the rest of the firm’s stakeholders. It discusses how corporate governance should be shaped in relation to existing firms, according in particular to some subjective criteria of fairness and fair play. It defines CG and explains the concept by stating its principles and codes as contained in the Organization for Economic Cooperation and Development (OECD). It states that countries such as Nigeria, the United States and the United Kingdom have developed their CG principles with corporate social responsibility (CSR) intent by using as a guideline the OECD principles and other sources of rules and principles of CG which includes the Companies and Allied Matters Act, Investment and Securities Act and a host of others. It states that the concept of CG applies to corporate businesses across the globe by highlighting the importance and specifying the distribution of rights and responsibilities among various corporate stakeholders such as board members, managers, shareholders and outlining the rules and procedures for making decisions. In doing so, it also provides the mechanism by which the company’s objectives are set, ways to achieve these and monitoring performance. The paper acknowledges that CG is a vital issue where a corporate organization is concerned but asserts that it is impossible for an organization to satisfy all stakeholders hence it is best to create a balance between meeting organizational objectives and that of its stakeholders.