2) Corporate governance is a some what of a system of rules, processes by which a firm is

directed and controlled. It involves balancing the interests of a company's stakeholders,

such as shareholders management, customer, suppliers, financiers, and the community,

corporate governance includes oversight in areas where there are conflicts of interest
among major stakeholders.The top managerial staff is the essential direct partner impacting
corporate administration. Executives are chosen by investors or designated by other board
individuals, and they speak to investors of the organization. The board is entrusted with
settling on vital choices, for example, corporate officer arrangements, official pay and profit
approach. In a few occurrences, board commitments extend past money related
enhancement, when investor goals require certain social or natural worries to be organized.

3) Internal mechanism

the primary controls come from the internal mechanisms. These actions control and monitor
the progress of the organization and take actions when the business goes off track. They
serve the internal objectives of the corporation and its internal stakeholders, including
employees managers and owners.

Internal mechanisms include oversight of management, independent internal audits,

structure of the board of directors into levels of responsibility, segregation of control and
policy development.

External Mechanism

External control mechanisms are controlled by those outside the organization and serve the
objectives of entities such as regulators, governments, trade unions, and financial
institutions. These objectives include adequate debt management and legal compliance

. External organizations, such as industry associations, may suggest guidelines for best
practices, and businesses can choose to follow these guidelines or ignore them.

4)Corporate governance standards implemented by Citic Pacific executives were inadequate

and failed to protect the Organization and its stakeholders of the losses. While the financial
failures are a constant in the business community, can limit the development
and implementation of prudential policies. These policies depend specifically on individual
aversion to risk of each economic agent. It seems that Citic Pacific executives had a high
tolerance for risk and an aversion to the low, and their prudential policies were just
existing. The management team at Citic Pacific seemed to have a great understanding of the
need for corporate governance. Furthermore, it was highly able to develop and implement
policies in respective within the required performance and needs measures. As they
declared, the management team at Citic Pacific took great pride in its commitment to
excellent standards of corporate governance and business practices of first class.

The role of the Board and the independent directors is the safeguard the well-being of
the organization. In addition, are in charge of the protection of the rights of actors who
have invested their money in the Organization, and which deserve to be informed and
protected. It must be ensured that the capital invested by the owners of shares properly
managed and fructified, through decisions and responsible and effective investment. The
Board at Citic Pacific failed in the protecting the company as well as the interests, and well-
being of the stock owners, without mention that more value was not created for the owners
of shares