Not all governments are bad: Corporate Governance.

Mexico is a country of families; the majority of companies, including the big conglomerates, are or started as a family company. Throughout their growth and globalization, regulatory and transparency issues hindered and even took away certain business opportunities.

Because of this, certain new actions and measures had to be adopted that would address these areas, which led to create Corporate Governance structures.

But, what entails Corporate Governance?

  • Issues regarding decision making that would affect the general strategic direction of the company and its corporate policies: investments, mergers and acquisitions, appointing executives, inheritances, etc.
  • The means of control regarding the proper performance of the directors and the implementation of the approved strategic plans.
  • Regulatory Compliance: establishing policies and proper procedures to guarantee that the company, directors, employees and third parties, comply with the regulatory framework that applies.
  • The interactions between the internal areas that govern the company, including their rights and duties of each of them: the board of directors, shareholders meetings, etc.

The installment of a code of good government is a guarantee for sustainable growth of the company in mid and long term, because it helps to establish investor confidence, increase foreign financing, attract talent and enhance the brand.

The rules if a good corporate government could be crucial elements to increase the stock value of the company, reduce capital costs and increase opportunities in capital markets. A good and healthy government structure would create the needed conditions to make strategic decisions to increase competitivity and generate value, enhancing the attractiveness of the company to outside investment.

In the same topic, having the position of compliance officer that carries out the control concerning the compliance with regulations regarding the company, complies with what international markets and new structures are pushing to.

The practices regarding corporate government point that besides looking after the needs and interests of the shareholders, keeping a permeant and efficient dialogue, prodding them to participate in the decision making of the company; as well as looking for the interests of third parties, employees and clients.

At Gloria Ponce de León & Hernández, we know of the importance that our clients put in simplifying and moving forward with their business, but at the same time complying with regulations and applicable laws, but is also important having access to cheaper financing sources. We understand the need to offer trust and results, as well as being innovative, being these 3 values the core f our firm: “innovation, trust and results”.

 

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