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Governance can be defined as which of the following?
Definition of Governance
Governance refers to the framework of policies, principles, and processes used to guide corporate decision-making and strategic direction.
It ensures accountability, transparency, and risk oversight within an organization.
Key Elements of Governance
Risk oversight -- Ensuring risks are properly identified and managed.
Accountability structures -- Defining roles and responsibilities.
Decision-making frameworks -- Establishing policies for long-term corporate success.
Why Other Answers Are Incorrect
Option
Explanation
A . Governance is a structure specifying the daily operation of a firm.
Incorrect -- Governance focuses on high-level corporate oversight, not day-to-day operations.
B . Governance is a structure specifying the ways in which reporting is made to the primary regulator.
Incorrect -- Governance is broader than just regulatory reporting.
C . Governance is being replaced by management in all firms that are regulated.
Incorrect -- Governance and management are separate but complementary; governance provides oversight, while management executes strategy.
PRMIA Reference for Verification
PRMIA 10 Principles of Good Governance