An EU-inspired corporate governance statement for Maltese listed companies - boon or scourge?

Abstract

The traditional definition of corporate governance is that of “the system by which companies are directed and controlled” (Cadbury Committee,1992: p 15). Indeed, corporate governance is concerned with the interaction of a company’s management, board of directors and stakeholders in ensuring the fairness of such a system. It needs hardly be said that corporate governance systems needed reform in the past decades for the sake of protecting the various stakeholders. For example, neither the USA nor the European Union could envy each other in the light of recent major corporate scandals such as Enron and Parmalat. Crises stimulate the search for new and more rigorous methods of surveillance and control (Moran, 1986). As would therefore be expected, both legislators and regulatory bodies have been increasingly involved in the tightening up of the global legislative regulatory framework.