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Corporate governance refers to how businesses, particularly private and public limited companies, are directed and controlled. This concept is significant due to the "divorce between ownership and control," where shareholders may not participate in the daily operations of the company. In these scenarios, the board of directors and senior management are responsible for managing the company, while shareholders retain ownership. Consequently, the board has a duty to act in the shareholders' interests. Understanding corporate governance is crucial as it encompasses the various processes and structures established to ensure accountability and alignment with shareholder interests.