The missing link to an effective corporate governance system

Abstract

Abstract Purpose – The purpose of this paper is to propose a new approach to designing enterprise systems (ES). The goal is to create an information system that can be more efficient and able to contribute to a more stable and efficient corporate governance system. Design/methodology/approach – The new design approach is based on a retrospective analysis of the evolution of enterprise systems and the emerging business requirements. Findings – The new ES (Holistic Information System) does not diminish the problem of Corporate Governance (CG). The design and implementation of ES, according to modern CG principles and guidelines, can help all parties make rational decisions (through the power of logic and not through the logic of power), facilitate the market for corporate control, the flow of information and hence the efficiency of the CG system. Practical implications – The new framework can help information systems designers to understand and create a more holistic system. Also, it can help stakeholders understand the role that the ES can play in the corporate governance system and exert influence on managers to adopt an information system that covers their needs as well. Originality/value – It is the first attempt to merge the theory of corporate governance with the ES theory in order to formulate a new design approach.

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