Corporate governance isn’t only for businesses legally structured as corporations. They’re a system that managers must not only follow through on well-planned strategic plans. They also have to be accountable and fair to all stakeholders. Regardless of whether your business has one or many stakeholders–shareholders, employees, clients, students or the community–your company’s approach to governance will change over time and depend on your unique needs and context. There are some general principles you can apply to any size business:

One of the most crucial aspects of good corporate governance is transparency. Transparency is crucial for board members and management to be transparent to auditors, shareholders and the public about financial reporting, accounting, important decisions, and internal processes. It is also essential that your company provides information on its social and environmental impact in ways that are easily accessible to those who may be interested.

Establishing clear roles and responsibilities is another aspect of corporate governance. This can be accomplished through job descriptions for your board, its vice chairs and chair committees and chairpersons, or terms of reference (TOR) for directors individually. This will ensure that there are clear boundaries and limits on authority, as well as an agreed-upon list of the responsibilities. It will help create a culture of collaboration and open communications and help to reduce errors and ensure compliance with regulations. It can also provide what are the four types of corporate governance greater opportunities for growth as your business grows and diversifies.