Question

Conduct research on an example of poor corporate governance demonstrated by a South African company. Write an essay where you define and explain the principles of good governance, illustrating your understanding through application to your selected company.

Answer 1

Corporate governance refers to the structures and processes that guide and control a company. One example of poor corporate governance in South Africa is Eskom's governance failures.

Step-by-step explanation:

Corporate governance refers to the structures and processes that are in place to guide and control a company at the highest levels of management. The principles of good governance include transparency, accountability, fairness, and responsibility. One example of poor corporate governance demonstrated by a South African company is the case of Eskom, the state-owned electricity provider.

Eskom has faced numerous governance failures, including allegations of corruption, financial mismanagement, and lack of transparency. For example, in 2015, Eskom came under scrutiny for awarding a contract to a company with close ties to one of its executives.

This example illustrates a lack of transparency, accountability, and fairness in Eskom's decision-making processes. The company failed to provide investors and the public with accurate information and demonstrated a lack of oversight by the board of directors.