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Increasingly, governments have recognised the synergy between macroeconomic and structural policies in achieving fundamental policy goals. Corporate governance is one key element in improving sustainable growth and ensuring market integrity and financial stability. It can also help achieve three major policy benefits: assist companies to access financing, particularly from capital markets; provide a framework to protect investors; and support the sustainability and resilience of corporations. Corporate governance involves a set of relationships between a company's management, board, shareholders and stakeholders. Corporate governance also provides the structure and systems through which the company is directed and its objectives are set, and the means of attaining those objectives and monitoring performance are determined. The Principles are non-binding and do not aim to provide detailed prescriptions for national legislation. Rather, they seek to identify objectives and suggest various means for achieving them.. They aim to provide a robust and flexible reference for  policy makers  and market participants to develop their own frameworks for corporate governance. The Principles focus on publicly traded companies, both financial and non-financial. They may also be used to improve corporate governance in companies whose shares are not publicly traded. The Principles cover six key areas:i) ensuring the basis for an effective corporate governance framework Ii) the rights and equitable treatment of shareholdersand key ownership functions. iii) institutional investors, stock markets and other intermediaries; iv) disclosure and transparency; v) the responsibilities of the board; and vi) sustainability and resilience.

Assessment Methodology

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The Methodology for Assessing Implementation of the G20/OECD Principles of Corporate Governance provides detailed guidance for how an evaluator might reach conclusions about whether and to what extent the outcomes advanced by the Principles are being achieved. In so doing, it recognises functional equivalence: there may be a number of ways in which a given outcome might be achieved. The Methodology also provides criteria for assessing the relative importance of particular principles in different jurisdictions thereby drawing attention to policy issues. As part of the Reports on the Observance of Standards and Codes (ROSC) initiative, the World Bank uses the Methodology to benchmark member countries' corporate governance framework and company practices against the G20/OECD Principles for Corporate Governance.