CORPORATE GOVERNANCE

The process by which organizations are directed, controlled and held accountable.

"Alcan is subject to a variety of corporate governance and disclosure requirements. Alcan's corporate governance practices meet or exceed the Toronto Stock Exchange Corporate Governance Guidelines (the "TSX Guidelines") and other applicable stock exchange and regulatory requirements and ensure transparency and effective governance of the Company. Alcan's Board regularly reviews its corporate governance practices in light of developing requirements in this field."
(Alcan Inc., Annual Report, 2003, visited 2009-06-10)

Corporate governance is comprised of "processes designed to regulate the decision-making power of executives to ensure that they do not serve their own vested interests to the detriment mainly of shareholders, but also of creditors, employees and the company in general."
(Vernimmen, Definition of Corporate governance - Finance dictionary, visited 2009-06-10)

"Corporate governance is 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."
(McRitchie, J., Corporate governance, 1999, visited 2009-06-10)

Soft Law and Corporate Governance

Soft law, which is defined outside of the legislative process, may provide a conceptual framework for decision-making in the corporate setting but does not seriously constrain decision makers. According to international and comparative scholars, soft law includes aspirational codes of conduct for corporate actors, corporate governance codes of best practices, treaty provisions, trade agreement provisions, etc.
(adapted from Branson, D., Teaching Comparative Corporate Governance: The Significance of ‘Soft Law' and International Institutions, Georgia Law Review, Social Science Research Network (SSRN), vol. 34, p. 669, Winter 2000, visited 2009-06-10)