What does corporate governance primarily focus on?

Corporate governance primarily focuses on the relationship between stakeholders, which includes shareholders, management, board members, and other parties involved in the company's ecosystem. This concept is essential in ensuring that the company is run in a responsible and accountable manner, balancing the interests of stakeholders while adhering to laws, regulations, and ethical standards.

Effective corporate governance helps in establishing a framework for achieving a company’s objectives and managing risks. It ensures transparency and fairness in the decision-making process, which is crucial for maintaining trust and credibility with investors, customers, employees, and the wider community. Stakeholder engagement is a core aspect of governance, as it encompasses the varying interests and influences that different groups have on a company's success and direction.

By prioritizing these relationships, corporate governance ultimately contributes to sustainable business practices that can lead to long-term profitability and growth, while also aligning business strategies with societal values and expectations.