Department
School of Accountancy
Document Type
Article
Publication Date
11-2004
Abstract
If something is important, eventually it gets measured. The last several years clearly have demonstrated that corporate governance is important, so it is no surprise that an industry has emerged to provide ratings of companies' corporate governance. There are several governance ratings providers, and three have been chosen that illustrate the types of rating systems currently in use: 1. Institutional Shareholder Services, 2. Corporate Library-Board Effectiveness Ratings, and 3. Governance Metrics International. For each service, the rating system's purpose, methodology, and criteria are presented. What is good about governance ratings? The ratings further promote the importance of good governance, and they can focus attention on key governance elements that often are linked to positive corporate outcomes. What are the limitations of governance ratings? "Good governance" is a nebulous construct, and the inside of the boardroom is not observable to outsiders.
Journal Title
Internal Auditing
Journal ISSN
0897-0378
Volume
19
Issue
6
First Page
37
Last Page
40