Governance versus Management

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Governance versus Management
Jaap de Jonge, Editor
What is the key difference between management and (corporate) governance? Well, in essence:
- Management (M) involves the activities of directing a (part of a) business.
- Governance (G) involves setting the conditions within which others can manage effectively. G also refers to the oversight of the entire firm on behalf of the owners of the firm - the shareholders - and the other stakeholders.

Dirección de Empresas y Gobierno Corporativo
Ricardo Zelaya Moreno, Member
Business management is the practice of management science, based on knowledge and responsibility. In corporate governance, like in public governance, we need to design transparant policies that promote the common good, taking into account the satisfaction of the needs, or the best balance, between groups of stakeholders.
La dirección de empresas es la práctica de la ciencia de la administración, basada en el conocimiento y responsabilidad; en la gobernanza, como gestión pública tenemos que diseñar políticas públicas que promuevan el bien común, tomando en cuenta la satisfacción de las necesidades o el mejor equilibrio entre los grupos de interés.

Management versus Corporate Governance
Wilbert Tomlinson, Member
In slightly different words:
- Management is the application of management functions and principles to different parts of the business or organisation.
- Corporate governance on the other hand, is establishing and maintaining the conditions whereby others can lead and manage effectively, efficiently and affectively.
Governance also involves the provision of oversight to the entire business or organisation on behalf of the owners, shareholders and other stakeholders.

Key Difference Between Management & (Corporate ) Governance
K.Narayana Moorthy, Member
  • MANAGEMENT: Plans, builds, runs and monitors activities in alignment with the direction set by the governance body to achieve the enterprise's objectives.
  • GOVERNANCE: Ensures that the stakeholder needs, conditions and options are evaluated to determine balanced, agreed-upon enterprise objectives to be achieved; setting direction through prioritization and decision making; and monitoring performance and compliance against agreed-on directions and objectives.
In short, governance is the responsibility of the board, while management is a responsibility of the executive management.


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