The purpose of this paper is to attract readers' attention to the importance of the integration of corporate governance and innovation for companies to strive further in business. The paper also attempts to illustrate how an innovation champion can exist in companies with a good corporate governance structure and fully utilize the structure, at the same time being aware of the limitations of innovation activities. Along the way, corporate social responsibilities should also be taken into consideration.
The objectives of this paper are achieved first through an explanation of how corporate governance structure works and what purpose it serves. By understanding the mechanics of corporate governance, the integration of the structure with other fields of knowledge, in order to boost corporate performance, becomes possible. The paper also makes several references to companies around the world which have integrated successfully.
Innovation is a teamwork effort. Concentrated efforts are needed from every person in the organisation, from the board of directors and all the employees. The main actor in the picture is the board of directors. Also, other critical factors such as culture, conducive environment and rewards very much need to be present in the system.
Innovation, even though deemed risky, must be supported. The board of directors or leaders of corporations must change the way they think. Leaders of corporations must make an effort to understand innovation, and subsequently spread it far and wide among managers by creating corporate policies that support innovation. With a consumer‐centric organizational principle in mind, corporations can improve their innovation success rate. A successful innovation effort requires full participation from everyone in the corporation to ensure that the end results of research and development are for the interests of society at large.
Corporate governance is a structure that needs input from other fields of knowledge. Too much faith is put in corporate governance to bring about performance; unfortunately corporate governance is just a structure. There are a lot more factors that should be taken into consideration before achievement can be seen and success stories can be heard. This integration of knowledge is suggested to companies so that they can generate more revenue.
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