The collapse of seven banks in two years was met with the rise of the term 'corporate governance', a phrase that’s swirled in talks among finance and business pundits throughout the country.

But what exactly is corporate governance? And how is it used to sustain corporations?

Next week, the Accra Marriot Hotel will host the Ghana Branding Summit, themed: Branding Ghana’s Banking Space through Corporate Governance. The one-day event aims to serve as a platform where CEO’s, managers and investors can meet to identify and solve problems surrounding their businesses both locally and abroad.

On the Super Morning Show Friday, branding expert, Sylvester Phish, said that solid corporate governance all simmers down to the rights and responsibilities of each individual within an organization. It’s a system based on “standards that must be followed.”

“First and foremost, the major objective of corporate governance is based off of structure. Without it, you will find yourself not following the basic principles of corporate governance.”

Branding expert Sylvester Phish

The structure of an organisation, Phish said, is largely based on the Chief Executive and Board of Directors, in addition to the criteria involved in how they are selected.

According to Phish, quality corporate governance and top-performing businesses go hand in hand. Quite simply, he said, consumers naturally gravitate to businesses if they are convinced that it is run properly. How consumers can prove a business is legitimate is based on transparency.

“That is why it is necessary for companies to declare publicly their financial statements,” he said. “It is so shareholders will know what is happening on the balance sheets.” Transparency also builds “reputation, credibility and trust.”

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According to the National Committee of Corporate Governance, there are eight key principles surrounding corporate governance. Those pillars are: governance structure, structure of the Board and its committees, director’s appointment procedures, directors’ duties, remuneration and performance, risk governance and internal control, reporting with integrity, auditing and relations with shareholders and stakeholders.

Poor corporate governance results in a business’ collapse, as was the case for The Construction Bank, The Royal Bank, uniBank, BEIGE Bank, Sovereign Bank, Capital Bank and UT Bank. Each of them was taken over by the Bank of Ghana, which admitted earlier this year on Joy FM that there were errors in the bank’s oversight.

“When you look at the entire picture, the CEO is part of senior management that relays the vision and values of the company to everyone else,” Phish said.

Poor corporate governance results in improper checks and balances and “leads to negligence.”