How can boards be made more responsible and accountable?
The Principles call on company boards to act objectively and independently and to be accountable to shareholders. Importantly, the concept of board independence and objectivity also apply to situations characterised by block and controlling shareholders, and not just referring to independence from management. Also, the duties and responsibilities of the board are defined as fiduciary in nature, a clarification that is of particular importance in the case of conglomerates, or groups made up of a number of different corporate entities. Boards should monitor and manage potential conflicts of interest. They should also be responsible for corporate ethics, compliance with laws and standards and for overseeing internal control systems, such as accounting and financial reporting.
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