What is the state of corporate governance in the UK, USA, EU, Literature review

What is the state of corporate governance in the UK, USA, EU, Australia, Japan and the GCC countries - Literature review Example It a discipline that focuses mainly on existing relationships between a company’s top management, its stockholders, boards, regulators, other stakeholders and auditors, and is a â€Å"system by which companies are directed and controlled† (Corporate Governance, nd., p.11). The system takes into account various market and regulatory structures, while also considering objectives for governing business firms. As OECD framed it, â€Å"Corporate governance involves a set of relationships between a company’s 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† (OECD, 2004, p. 11). ... pted for preventing or diminishing contentious issues arising mainly from conflicts of interests include institutions, customs, procedures, laws and policies, which affect the manner in which a business firm is regulated (Cadbury, 1992, p. 15). An important theory within corporate governance deals with the extent and nature of  liability  of those concerned in the running of the  business. Another related yet different theory within corporate governance deals with its effects on  economic efficacy that mainly focuses on the welfare of its shareholder (Haidar,  2009). In large corporations that have different management and ownership with no regulating shareholder, the  agent-principal issues  may crop up between top management (an agent) that may have varying interests and may possess more information than the firm’s shareholders which form the principals. The main problem in this field arises when the board of directors instead of managing on behalf of the compa ny shareholders become separated from the latter, while becoming to more loyal to the firm’s management (Bebchuk and  Jesse, 2006). This dimension is often present in many of the current public debates, and is taken into consideration while framing regulatory policies. Currently there has been a great deal of interest in studying theories and practices of corporate governance of contemporary business firms, especially in the context of liability, after the bankruptcy of many of the well-known MNCs during 2002 and again during 2007-09 economic crisis, which concerned primarily accounting fraud (Haidar,  2009). Various corporate scandals  at different times, over the past few years, have led to sustained interests from both political and public world in maintaining a control and regulation over corporate