Managing Fraud Risk: A Practical Guide for Directors and Managers

Answers to the Quiz

Fraud Awareness Quiz – Question 5

What are the first two words or phrases that come into your mind when you hear the term corporate governance?

Background

This is a different type of question to most of the others in the Quiz as there are no right and wrong answers to it. I use it on fraud courses to stimulate a discussion on what corporate governance is all about. This provides important background for my delegates before we go on to look at the critical governance dimension of the fraud problem. So, I have tried to replicate the main points coming out of these discussions below. They lead to, if not a “correct” description of corporate governance, then hopefully a better understanding of what corporate governance is all about.

Corporate governance means different things to different people. I know this very well from working with and teaching business professionals around the world. Consequently, every delegate has a different answer to the question and none are unequivocally right or wrong.

My own personal view is that corporate governance is all about how companies are run at the top. It has two fundamental components: board compliance and board performance. But when I am teaching about fraud I need to know what the delegates who are attending the course on a particular day think about this and their answers to this question give me a very good indication.

Governance as Compliance

The first thing to say is that, over the years, a big majority of delegates ...