The paper "Corporate Governance is Important for Family Businesses and Large Corporations" is an outstanding example of a business literature review. Corporate governance can be described as the processes and structures for the control and direction of businesses as well as the relationships amongst the stakeholders such as minority shareholders, the board of directors, the management, and controlling shareholders. Corporate governance can also be described as a blend of the external mechanisms (legal protections, the capital market, managerial labour market, and takeover) and internal mechanisms (ownership and board of directors). Given that good corporate governance leads to the sustainable development of the economy through companies’ performance improvement, it is very important that companies espouse good structures for corporate governance so as to grow.
Normally, family businesses are overlooked types of business ownership in the modern-day business world, yet they account for the majority of the businesses. Therefore, families own considerable businesses share and could influence crucial decisions in the contemporary business world. Still, the research of corporate governance with regard to family business has been neglected for many years.
Given that family businesses have become a crucial part of all economies and play an important part in promoting the economy of the country, they still face a number of pressures and challenges as any large corporation. The objective of this paper is to demonstrate that corporate governance is important for family businesses as well as large corporations and also to compare and contrast the corporate governance characteristics of large companies and family businesses. Contemporary International Context of the Issue Family businesses, according to Yasser (2011), range from Small- and Medium-sized companies and Cluster Companies to large companies operating in different countries as well as industries.
There are many recognized family businesses across the globe: Michelin, Carrefour Group, L’ Oreal, and LVMH (France); FiatGroup, Benetton, and Salvatore Ferragamo (Italy); LG Group, Hyundai Motor, Samsung (South Korea); Siemens and BMW (Germany); Wal-Mart Stores and Ford Motors Co (United States); and many others (Yasser, 2011).
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