From Corporate Law to Corporate Governance

It is then obvious that the formal corporate legal skeleton covers only a very small part of how the corporation actually operates to carry out its business and continually adapts to its business environment. The rest and obviously most important part of the governance structure—the dark matter of corporate governance—is the realm of reporting relationships, organizational charts, compensation arrangements, information gathering and internal controls and monitoring, all largely non-legally dictated policies, practices and procedures that do not appear in the corporate statute or the corporation’s charter or bylaws.