The Strengths and Weaknesses of Lehman Brothers’ Corporate Governance Mechanisms and Internal Controls

Abstract

Lehman Brother’s corporate governance mechanisms and internal controls had several flaws that led to the downfall of the organization. The company lacked corporate governance measures that could highlight the fraudulent activities within the company. Corporate governance in any organization is controlled by the shareholders (owners) of the company, the directors of the company and its managers who utilize the company’s assets. The four pillars of corporate governance are accountability, fairness, transparency and independence. The role of banking reforms in controlling financial institutions have been in place for long.