Corporate Governance Quotient - CGQ


DEFINITION of 'Corporate Governance Quotient - CGQ'

A metric developed by Institutional Shareholder Services (ISS) that rates publicly traded companies in terms of the quality of their corporate governance. Each public company covered by the metric is assigned a rating based on a number of factors that are considered by the ISS model. Factors used in the CGQ formula include board structure and composition, the executive and director compensation charter, and bylaw provisions.

BREAKING DOWN 'Corporate Governance Quotient - CGQ'

The CGQ serves as a reasonable approximation of the quality of a public firm's corporate governance. Investors seeking to hold shares in a company for the long term will typically be concerned about the quality of their company's corporate governance, as research has shown that a high quality of corporate governance typically leads to enhanced shareholder returns.

  1. Bureaucracy

    An administrative or social system that relies on a set of rules ...
  2. Market-Based Corporate Governance ...

    A system relying on the investors of a firm to exert control ...
  3. Internal Audit

    The examination, monitoring and analysis of activities related ...
  4. Corporate Governance

    The system of rules, practices and processes by which a company ...
  5. Shareholder Activist

    A person who attempts to use his or her rights as a shareholder ...
  6. Sarbanes-Oxley Act Of 2002 - SOX

    An act passed by U.S. Congress in 2002 to protect investors from ...
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    Before a business can assess or mitigate business risk, it must first identify probable or likely risks to its bottom line. ... Read Full Answer >>
  3. Why has emphasis on corporate governance grown in the 21st century?

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  4. What impact did the Sarbanes-Oxley Act have on corporate governance in the United ...

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