In any society, individuals and companies exist in an organized way, making decisions about the work that needs to be done and how it is done. To maintain order in society and sustainability of operations, individuals and companies' decisions must be ethical and socially responsible. For companies, ethical decisions are assured by way of corporate governance practices. In this module, I shall elaborate on the concept of corporate governance, its latest development, and how the board and corporate governance professionals, like accountants, function as key players in the practices. I shall also touch on corporate social responsibility, CSR, which is a thriving area of companies' practice. There are many different definitions of corporate governance, and perhaps the most pragmatic and succinct definition is the one put forward by the Company Report of 1902, where corporate governance is defined as the way by which companies are directed and controlled. Companies refer more specifically to limited liability companies, while direct and control are what the board of directors regularly do for companies. So, what exactly does corporate governance involve? Answers can be found in another more elaborate definition of corporate governance, put forth by Omen in 2003, which describes corporate governance as this. This definition describes the nature of corporate governance as a collection of laws, rules, and regulations, put together for companies to comply with. It also highlights that companies are accountable to those who invest resources in companies. Who are those parties who invest resources? Only shareholders? What are the resources concerned? Resources can be either money or in-kind, and of parties who invest resources. Shareholders are definitely one party who invest share capital in the companies. Other parties may include banks and suppliers, who respectively provide loans or inventories to companies for their business operations. Employees dedicate their time and expertise for achievement of company's goals. Governments provide a physical and legal infrastructures, so that companies can operate in an orderly society. In return for their investments, company must observe the interests of each of these parties. All these interests may, of course, vary. Therefore, we treat all these and other parties collectively as stakeholders. One of the contemporary thoughts for advocating corporate governance is exactly to ensure that companies will serve their stakeholders' interests as a whole in their operations. Yet, with the various stakeholders in place and the interests to be served, there are often conflicts of stakeholders' interests, which corporate governance has to resolve. It is impossible to make everyone happy, and therefore, corporate governance in practice is often more for assurance of ethical decisions made by the board, while mitigating conflicts of interests among stakeholders. Should the board fail in upholding ethics in companies' actions or mitigating conflicts of stakeholders' interests, impacts of companies' actions, favorable or unfavorable, will then fall unevenly on different stakeholders. From past experience, an ethical company behaviors contemplated under poor corporate governance include looting, which can be misappropriation of clients' money by professionals, or embezzlement of companies' money by executives. Insider trading by directors and senior executives are also unethical. Such could have been stopped if the committing parties were ethical and controlled effectively by companies' policies. Other not strictly illegal, but definitely unethical behaviors, include excessive risk-taking by board's decisions, excessive remunerations approved by board for directors and executives, unsuccessful and non-performing executives given a golden handshake, with huge severance money, when they're dismissed by companies, and so on. As you can see in the last few examples, it is the standard of ethical decisions by the board that is of concern in corporate governance. This equals with what I had said in the module about ethics, that for companies to be ethical, there needs to be an ethical board, and corporate governance practices are here to ensure that such is in place.