Corporate governance is the framework of laws rules, and procedures that regulate the

interactions and relationships between the providers of capital (owners), the governing body
(the board or boards in the two-tier system), seniors managers and other parties that take part
to varying degrees in the decision making process and are impacted by the companys
dispositions and business activities. Corporate governance defines their respective roles and
responsibilities and their influence in steering the course of the company or Corporate
governance refers to the set of systems, principles and processes by which a company is
governed.
They provide the guidelines as to how the company can be directed or controlled such that it
can fulfil its goals and objectives in a manner that adds to the value of the company and is
also beneficial for all stakeholders in the long term. Stakeholders in this case would include
everyone ranging from the board of directors, management, shareholders to customers,
employees and society. The management of the company hence assumes the role of a trustee
for all the others.
Corporate governance has become a buzz word in the business management field. Owners of
businesses of all sizes are employing the concepts of corporate governance to develop a
strategic plan for operations. This includes systems and procedures designed to structure
authority, balance responsibility and provide accountability to stakeholders at all levels. In
essence, corporate governance is about balancing profitability with sustainability.
Management on the other hand refers to the actions taken by a company to lead the business
in a positive direction. Examples of management include setting budgets, giving staff
members directions and making strategic plans about marketing or product development.
Corporations usually have management teams once the company becomes too big for the
founder or one individual to oversee the entire business. Management team members include
titles such as department head, director, vice president and manager, chief executive officer,
chief operating officer and chief financial officer.
They also differ in the following ways
Governance comes from the word govern, which means to control the actions of a group
for the benefit of the whole. In the business world, this refers to policies that specifically
restrict or direct how people can act. For example, governance policies might include
prohibiting a board of directors from awarding contracts to board members companies or the
companies of family members. A business might require its accounting department to have

two signatures on any check it writes to reduce the threat of fraud. Corporate governance
therefore differs from management in that governance is primarily about protecting a
business, while management is more about growing it. Governance refers to the policies and
procedures set in place to ensure a business operates within the law and for the optimal
benefit of all stakeholders. Management refers to the techniques executives use to help the
company operate
They also differ in functions

whereby cooperate governance has the following core

functions
Strategic direction. Exercising effective leadership that optimizes the use of the financial,
human, social, and technological resources of the program. Establishing a vision or a mission
for the program, reviewing and approving strategic documents, and establishing operational
policies and guidelines.
Continually monitoring the effectiveness of the programs governance arrangements and
making changes as needed.
Management oversight. Monitoring managerial performance and program implementation,
appointing key personnel, approving annual budgets and business plans, and overseeing
major capital expenditures. Promoting high performance and efficient processes by
establishing an appropriate balance between control by the governing body and
entrepreneurship by the management unit. Monitoring compliance with all applicable laws
and regulations, and with the regulations and procedures of the host organization, as the case
may be.
Stakeholder participation. Establishing policies for inclusion of stakeholders in
programmatic activities. Ensuring adequate consultation, communication, transparency, and
disclosure in relation to program stakeholders that are not represented on the governing
bodies of the program.
Risk management. Establishing a policy for managing risks and monitoring the
implementation of the policy.
Wheres the functions of management is include the following but they vary by program size
and type, partnership arrangement, legal arrangement, etc. Though the proceeding list is not
exhaustive, seven general functions of management are as follows:

 Program implementation. Managing financial and human resources.

Reviewing proposals for inclusion in the portfolio of activities and allocating financial
resources among activities.
Supervising the implementation of activities. Contracting with implementing or executing
agencies to implement individual activities. Ensuring that these agencies are self-monitoring
and reporting their progress in a timely way.
Regulatory compliance. Ensuring compliance with all applicable laws and regulations at
the international, national, and institutional levels, including the regulations and procedures
and adhering to these requirements and standards on a day to day basis.
Reviewing and reporting. Taking stock of the overall performance of the portfolio in
relation to the programs objectives and strategies. Reporting progress to the governing body,
including any adverse effects of the programs activities.
They also differ in activities as follows
Common Governance Activities
Businesses benefit from written policies and procedures that allow leaders to avoid specific
conflicts of interests and fraudulent activities before they happen and to detect any fraud that
might occur. Many governance policies pertain to financial activities, setting procedures for
soliciting and awarding contracts, accounting practices and disbursing profits. Business set
strict rules for human resources activities that fall under state and federal guidelines. When a
corporation becomes a public company, corporate governance expands to include following
SEC rules and providing transparency for shareholders. Unlike company policies that govern
the behaviour of individual employees, such as dress codes or grievance procedures,
corporate governance policies pertain mostly to the operations of the business.
Common Management Activities
Management activities help a business operate, with instruction from top leaders directing the
activities of staff members. Companies create plans for developing, pricing, promoting and
distributing their products, put systems into place to oversee their plans and review and assess
their projections and performance. Companies manage their employees by training workers to
help them perform better. Analyses of operations help management to determine if the

company needs to change any practices, such as bringing contracted work in-house or vice
versa, setting new goals, modifying the marketing mix and monitoring financial performance.

Furthermore Board of directors govern an organization, while the CEO and his team manage
the organization. Cooperate Governance is overseeing the corporate policy implementation
for fulfilling all the stakeholders' expectations. Governance includes, discharging of:
Economic, Legal, Ethical and Social responsibilities. Management's job is prudent utilization
of corporate resources for sustainable growth and development by creating competitive
advantage through research, innovation and development of intellectual capital. Decision
makings & control, are integral part of both governance and management.
Corporate governance is not an abstract goal, but exists to serve corporate purposes by
providing a structure within which stockholders, directors and management can pursue most
effectively the objectives of the corporation wheres Essentially, the role of managers is to
guide the organizations toward goal accomplishment. All organizations exist for certain
purposes or goals, and managers are responsible for combining and using organizational
resources to ensure that their organizations achieve their purposes.
Corporate governance describes all the influences affecting the institutional processes,
including those for appointing management (controllers and/or regulators, involved in
organizing the production and sale of goods and services). Described in this way, corporate
governance includes all types of firms whether or not they are incorporated under civil law
Company-with corporate governance, enable the management supervisory function of the
directors to be separated from the business execution function of the executive officers. The
executive officers perform decision-making and business execution, as entrusted by the
Board of Directors. The content of this business execution is subject to the oversight of the
Board of Directors and to audits by the Audit Committee, which enhances effectiveness,
validity, legality and soundness of the management.
How the two relate
Corporate governance and management are most often viewed as both the structure and the
relationships which determine corporate direction and performance. The board of directors is
typically central to corporate governance. Its relationship to the other primary participants,
typically shareholders and management, is critical. Additional participants include

employees, customers, suppliers, and creditors. The corporate governance framework also
depends on the legal, regulatory, institutional and ethical environment of the community.
Whereas the 20th century might be viewed as the age of management, the early 21st century
is predicted to be more focused on governance. Both terms address control of corporations
but governance has always required an examination of underlying purpose and legitimacy.
Once a business has clearly defined and recognized its internal and external stakeholders, the
corporate governance structure can proceed to provide accountability plans for these
stakeholder groups. Accountability is about managing obligations of the individual
stakeholders and of the business as a whole. Not only must your business be responsible for
its financial matters, but also for following the law, for disclosing the results of business
matters to key stakeholders and for keeping your practices transparent and ethical and this is
possible with the combination of both corporate governance and management
Corporate governance deals with the conflicts of interests between the providers of finance
and the managers; the shareholders and the stakeholders; different types of shareholders
(mainly the large shareholder and the minority shareholders); and the prevention or
mitigation of these conflicts of interests. Corporate governance is a field in economics that
investigates how to secure motivate efficient management of corporations by the use of
incentive mechanisms, such as contracts, organizational designs and legislation. This is often
limited to the question of improving financial performance, for example, how the corporate
owners can secure/motivate the corporate management which will deliver a competitive rate
of return or Corporate governance is about how investors get the management to give them
back their money corporate governance is gathering together a group of smart, accomplished
people around a board table to make good decisions on behalf of the company and its
stakeholders.
Corporate governance and management is the relationship among various participants [chief
executive officer, shareholders, and employees] in determining the direction and performance
of corporations As Professor Sir George Bain once said, the big advantage of the shareholder
model over the stakeholder model in management terms is the simple goal it presents:
maximise shareholder value. No such simple target attaches to the stakeholder approach, and
yet without a clear goal, management faces an impossible task in trying to do its job properly
In conclusion Effective corporate governance and management are key mechanisms for
ensuring that an organisations strategy is effectively delivered within thresholds agreed by

the Board and the executive. It involves a complex set of relationships between a companys
management, its Board, its shareholders and other stakeholders. Corporate governance also
provides the structure through which the objectives of the company are set, and the means of
attaining those objectives and monitoring performance are determined. management is the
culture, processes and structures of an organisation which when articulated into policies to be
implemented at all levels of the organisation, ensure that the goals of the organisation are
achieved in order to attain the required outcomes and enduring benefits to the organisation
and hence growth of the organisation