The enterprise Value of allowable Corporate group responsibility

Corporate group accountability (Csr) is the belief that that a corporation's responsibilities comprise other stakeholders and includes other responsibilities above and beyond a return for shareholders. These responsibilities comprise legal, ethical and philanthropic responsibilities in addition to economic responsibilities (Trevino and Nelson, 2005, p. 31). Other stakeholders could comprise employees, suppliers, the customers, the society and others. Types of responsibilities the corporation may hold beyond a return for shareholders could include, protecting and or improving the environment where the company operates, improving conditions for the society where the company resides, etc...

Corporate Governance refers the way in which the corporation governs itself. Governance includes the way the company reports earnings, pays Directors, etc... Recognizing that improper governance can have huge consequences for employees and shareholders, the government requires corporations to result Corporate Governance laws and guidelines that are designed to cut the risk of fraud, and financial ruins such as those that caused the demise of corporations like Enron, WorldCom and Global Crossing.

Solid Corporate Governance that protects investors and employees from accounting fraud, disagreement of interest, etc., can be seen as a part of any company that is acting socially responsible. Because a Csr company is acting in a way above and beyond what is required of it by law to safe stakeholders in the company, solid Corporate Governance of a Csr oriented company could be viewed as a way in which the company can ensure that the interests of many directly associated and dependent on the company can be protected, including; employees, customers, the communities that depend on tax revenues and employment, etc... Solid Corporate Governance can be seen as an necessary first step of any Csr oriented company. Without it, it risks disagreement of interest of its board members, Ceo, uncertain financial and accounting practices and other risks which could have devastating negative impacts on all stakeholders. For example, Enron's collapse due to failure of Corporate Governance to prevent fraud and deceit hurt thousands of employees, the society of Houston, where most employees lived, the tax revenues that supported group works, the result on families and couples who lost withdrawal savings, health guarnatee coverage, etc... In fact, before Enron's accounting fraud became known, many would have thought about Enron a solid socially responsible habitancy because of its much recognized funding of museums, hospitals and many other organizations in the society where they operated (p. 163). However, all the communities would have been best off in the long run, if Enron had never contributed a dime to these group responsible activities, but had rather in case,granted solid Corporate Governance over its internal operations. If Enron had done this, thousands would not have lost jobs, communities would have maintained higher tax revenues, retirements would have been more secured for thousands, health guarnatee would have been secured by many more, returns would have been higher for investors and shareholders, etc...

Corporate Governance should be seen as a top priority of any company seeking to be a good corporate citizen. More good can be done by a company ensuring solid corporate governance, than other activates usually seen as leading for Socially known organizations. Furthermore, more pressure should be exerted on organizations to compose good group governance than should be exerted on fellowships to sponsor other socially responsible activities and stakeholders in communities, the press, the government, etc., should also recognize and applaud fellowships who may put more exertion on Corporate Governance although they may lack other group activities. Governance should be seen ad rewarded as the top priority.

References:

Trevino, L., and Nelson, K., (2005). Corporate group accountability and managerial ethics. Hoboken, Nj: John Wiley and Sons, Inc.

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