Governance can be defined as which of the following?

Definition of Governance

Governance refers tothe framework of policies, principles, and processesused toguide corporate decision-makingand strategic direction.

Itensures accountability, transparency, and risk oversightwithin 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– Governancefocuses 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 areseparate but complementary; governance provides oversight, while management executes strategy.

PRMIA 10 Principles of Good Governance

PRMIA References for Verification