Discussion on Corporate Governance

The role of corporate governance for firms: The prominent role of corporate governance for firms is a higher valuation of the company, effective use of capital, and reduction of risks for firms (Newell & Wilson, 2002) [21]. Corporate governance is the relationship between many parties involved in the process of determining a company's direction and operations. Participants primarily include shareholders, management, and the board of directors (Monks & Minow, 2001) [18]. Clarke (2004) [8] and Tricker (2009), with an approach that covers all factors that can affect the exercise of power in corporations, believe that corporate governance is the way of governing corporate entities, the implementation power over corporate entities. In Vietnam, there are legal documents regulating corporate governance applicable to public companies, such as Circular No. 121/2012/TT-BTC and Enterprise Law (National Assembly, 2020) [20], etc. In Vietnam today, the corporate governance model is organized in a two-level structure, including the general meeting of shareholders, the board of directors, the executive board, and the inspection committee. Through qualitative research methods, this article will discuss corporate governance and mention the history of its formation and development, a research overview, the role of corporate governance, the characteristics of the board of directors, and the effectiveness of corporate governance.