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Corporate governance refers to the framework and practices that dictate how companies, both private and public, are directed and controlled. It is particularly crucial due to the "divorce between ownership and control," where a company's board of directors and senior management oversee operations, while many shareholders are disconnected from daily management. This situation requires the board to act in the best interests of the shareholders, ensuring accountability and ethical practices. As a result, various processes and structures are established to uphold these governance principles, emphasizing the importance of transparency and responsibility in corporate management.