Effect of Corporate Governance on Performance of Audit Firms in United Kingdom; Case of Deloitte Touche Tohmatsu Limited

Abstract

Good corporate governance brings about ethical company practices that cause financial viability. Corporate governance is the system of rules, practices and processes by which a company is directed and controlled. It can be argued that corporate governance includes how companies are governed and for what purpose. Notably, corporate governance identifies who has power and accountability and who makes decisions. Thus, the study sought to examine the effect of corporate governance on the performance of audit firms in the United Kingdom in the case of Deloitte Touche Tohmatsu Limited. The study made inferences based on the reviewed literature. The outcomes of the study showed that corporate governance is key in determining performance. Efficient application of sound corporate governance needs relevant lawful, governing and institutional foundations. Strong and effective corporate governance helps to cultivate a company culture of integrity, leading to positive performance and a sustainable business overall. Essentially, it exists to increase the accountability of all individuals and teams within your company, working to avoid mistakes before they can even occur. The study concluded that the performance of an organization can be highly influenced by the extent of corporate governance. The research recommended that there is a need to form a governing body to improve corporate governance using a particular code of ethics to protect the public interest in the firm. Organizations need to have controls and corporate governance criteria to increase their level of responsibility and performance. Corporate governance should be regarded as one of the key aspects that need to be a consideration in the policy formulations of the audit firms. Keywords: Corporate Governance, Performance, Audit Firms, Deloitte Touche Tohmatsu Limited, United Kingdom