Corporate Governance 2.0

Corporate Governance 2.0

Author: 
Subramanian, Guhan
Publisher: 
Harvard Business School Press
Date published: 
2015
Record type: 
Journal Title: 
Harvard Business Review
Source: 
Harvard Business Review, Vol. 93, No. 3, March 2015, pp. 96-105
Abstract: 

Corporate Governance 2.0 is not quite a clean-sheet redesign of the current system, but a back-to-basics reconceptualization of what sound corporate governance means. It is based on three core principles: 1. Boards should have the right to manage the company for the long term. 2. Boards should install mechanisms to ensure the best possible people in the boardroom. 3. Boards should give shareholders an orderly voice. The shift is vital in the United States, where the power of shareholders has increased over the past ten years and the natural instinct of boards is to cave to activist demands. Over the long term, a Corporate Governance 2.0 perspective would transform corporate governance from a never-ending conflict between boards and shareholders to a source of competitive advantage in the marketplace.

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CITATION: Subramanian, Guhan. Corporate Governance 2.0 . : Harvard Business School Press , 2015. Harvard Business Review, Vol. 93, No. 3, March 2015, pp. 96-105 - Available at: https://library.au.int/corporate-governance-20