Paper Contents
Abstract
Corporate governance is a critical mechanism that shapes organizational decision-making, accountability, and transparency, directly influencing financial performance. This conceptual study examines the relationship between corporate governance structurescomprising board composition, ownership patterns, audit committees, and executive compensationand financial outcomes such as profitability, return on assets, and market valuation. The study highlights that well-defined governance frameworks strengthen internal controls, mitigate agency conflicts, and enhance investor confidence, ultimately improving financial results. Conversely, weak governance practices may lead to financial mismanagement, reduced transparency, and lower organizational performance. By reviewing existing literature and integrating theoretical perspectives such as agency theory, stewardship theory, and resource dependency theory, this study provides a comprehensive understanding of how corporate governance mechanisms contribute to financial outcomes. The study emphasizes the strategic importance of aligning governance structures with organizational objectives to achieve sustainable financial growth. Furthermore, it outlines the moderating role of organizational size, industry type, and regulatory environment on the effectiveness of governance mechanisms. This conceptual analysis offers valuable insights for researchers, policymakers, and corporate managers, highlighting the significance of governance design in shaping organizational financial health and long-term value creation.
Copyright
Copyright © 2025 Jyothi Matta. This is an open access article distributed under the Creative Commons Attribution License.
