Why Traditional Corporate Governance Implementations Fail and Lack Sustainability

Abstract

The collapse of high-profile international businesses, giant banks and megamultinational companies over the past several years, the recent unprecedented worldwide financial crisis, the power shift from public to private sector through converting state-owned enterprises to joint stock publicly-owned companies, the transfer of technology, and globalization are compelling reasons for good corporate governance practices to be applied. Large-scale accounting scandals that brought trouble to many large companies are often caused by unethical behavior of top-executives. Poor ethical leadership, lack of integrity, mismanagement, fraud, corruption, and violating corporate governance rules are the main contributors towards bankruptcy and financial failures. This article introduces an authentic way to reduce these failures.