COMPARATIVE ANALYSIS BETWEEN THE TRADITIONAL MODEL OF CORPORATE GOVERNANCE AND ISLAMIC MODEL

Corporate governance represents a set of processes and policies by which a company is administered, controlled and directed to achieve the predetermined management objectives settled by the shareholders. The most important benefits of the corporate governance to the organisations are related to business success, investor confidence and minimisation of wastage. For business, the improved controls and decision-making will aid corporate success as well as growth in revenues and profits. For the investor confidence, corporate governance will mean that investors are more likely to trust that the company is being well run. This will not only make it easier and cheaper for the company to raise finance, but also has a positive effect on the share price. When we talk about the minimisation of wastage we relate to the strong corporate governance that should help to minimise waste within the organisation, as well as the corruption, risks and mismanagement. Thus, in our research, we are trying to determine the common elements, and also, the differences that have occured between two well known models of corporate governance, the traditional Anglo – Saxon model and also, the Islamic model of corporate governance.