Abstract
Good corporate governance has been attributed to many large organizations’ success. From the boardroom to the triple bottom line, it has been hailed as one powerful tool that brought about sustainability of these organizations in this competitive era. While this is beneficial to large organizations, small and medium enterprises (SMEs) can glean on such experiences to add their value to their companies which, in the long run could bring about new markets and improved business practices which can be ground breaking in their daily business dealings. Thus, if with the introduction of the King Report on good governance, competitive advantage is improved, SMEs are in a good position to sustain their businesses in turbulent economic conditions. This article is aimed at exploring the benefits with which good corporate governance can yield to top and bottom JSE listed SMEs in South Africa. A desktop method was used to analyze the financial statements of these SMEs companies with the view to gain understanding on their corporate governance activities and how well they benefit them. The findings show that good corporate governance is beneficial to SMEs.
Highlights
The origins of good corporate governance date back to many years as far back as 18th century where its first seeds were seeded in both the East and the West (Masons, 2013)
From the boardroom to the triple bottom line, it has been hailed as one powerful tool that brought about sustainability of these organizations in this competitive era. While this is beneficial to large organizations, small and medium enterprises (SMEs) can glean on such experiences to add their value to their companies which, in the long run could bring about new markets and improved business practices which can be ground breaking in their daily business dealings
The findings show that good corporate governance is beneficial to SMEs
Summary
The origins of good corporate governance date back to many years as far back as 18th century where its first seeds were seeded in both the East and the West (Masons, 2013). In one of their series, Microsoft (2013) postulated that an intensification of corporate governance as a business primacy has led to a growing industry of experts promoting counsel These views are supported by Bicksler (2013), as he views good corporate governance as aligning executive management actions with those of shareholders and by so doing, corporate governance becomes entangled with decision queries as to whether formulated strategy and implemented tactics by companies executive managements serve the best interest of the equity shareholders. It is on this premise that Deloitte (2013) suggested that developing a framework common to governance could play a significant role in assisting boards to achieve a better understanding of the oversight role. This structure should have elements that contribute to effective governance, as well as the tools for addressing governance risk
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