Corporate governance and the small and medium enterprises sector: theory and implications

Abstract

Purpose

The purpose of this paper is to identify the extent to which the corporate governance framework can be applied to small and medium enterprises (SMEs), and discuss these issues further within the Ghanaian context.

Design/methodology/approach

After considering some of the key issues, the paper shows how relevant these issues are to the SME sector.

Findings

It is clear that corporate governance brings new strategic outlook through external independent directors and enhances firms' corporate entrepreneurship and competitiveness. Again the problems of credit constraint and managerial incompetence in the Ghanaian SME sector could also be overcome with a good corporate governance structure in place.

Research limitations/implications

The discussion mainly focuses on corporate governance within the context of Ghanaian SMEs.

Originality/value

This paper provides conceptual insights on the application of corporate governance among SMEs.

Citation

Abor, J. and Adjasi, C.K.D. (2007), "Corporate governance and the small and medium enterprises sector: theory and implications", Corporate Governance, Vol. 7 No. 2, pp. 111-122. https://doi.org/10.1108/14720700710739769