Fundamentals of Risk Management

iV. role of stakeholders 
in corporate governance
Recognize the rights of stakeholders established by 
law or through mutual agreements and encourage 
active co-operation between corporations and 
stakeholders
V. Disclosure and 
transparency
Timely and accurate disclosure is made on all material 
matters, including the financial situation, performance, 
ownership and governance of the company
Vi. responsibilities of 
the board
Strategic guidance of the company, the effective 
monitoring of management by the board and the 
board accountability to the company and the 
shareholders

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Risk governance
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the avoidance or mitigation of problems. It defines different accountabilities to
different stakeholders and is intended to be used as a basic checklist to ensure that 
all the elements of a good governance system are in place. The point is also made that 
having a corporate governance system in place does not guarantee effective governance, 
but it does encourage and support positive organizational values and behaviours.
Lse corporate governance framework
The London Stock Exchange (LSE) has produced guidance on corporate governance, 
and the focus of that guidance is on the effectiveness of the board. In the view of
LSE, corporate governance is about the effective management of the organization 
and the appropriate responsibilities and the role of the senior managers and board 
members within the organization.
Figure 28.1 provides a summary representation of the London Stock Exchange 
governance framework. Governance activities are centred on the board of the
organization and the LSE guidance refers to these boards as supervisory and man-
agerial boards. The corporate governance framework has two main components:
1) the responsibilities, obligations and rewards of board members; and 2) the fulfil-
ment of stakeholder expectations, rights, participation and dialogue.