Difference Between Corporate Governance And The Uk Public And Private Sector

1792 Words Feb 11th, 2015 8 Pages
Critically analysis the key differences and similarities between corporate governance in the uk public and private sectors.
Corporate Governance and laws or regulations related to it affect both the private and the public sector in the UK. There are key differences and similarities in their corporate governance practice and can affect how businesses run under governance codes which they must follow. The UK corporate governance code affects the private sector and focuses on Leadership, Effectiveness, Accountability, Remuneration, Relations with shareholders. The public sector has Accounts and Audit Regulations among others to follow which has its own rules and regulations which are legally required.
Corporate governance in itself has no single definition but common principles which it should follow. For example in 1994 the most agreed term for corporate governance was “the process of supervision and control intended to ensure that the company’s management acts in accordance with the interest of shareholders” (Parkinson, 1994)1. Corporate governance code is not a direct set of rules but a self-regulated framework which businesses choose to follow. This code has continued to change in the past 20 years in accordance with what is happening in the business world. For example the Enron scandal caused reform in corporate governance with the Higgs Report which corrected the issues which were necessary. Although it does not quickly fix problems, it gives a better framework to…
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