But don’t worry, this is going to be much easier to understand than your 11th grade government class. We’ve put together an easy to follow guide that outlines what corporate governance is, who is involved with it, and why it matters on a grand scale.

While corporate governance might seem straightforward, it’s actually more complicated than you might think. There are several moving parts within a corporate governance framework that are all required to work together.

In broad terms, corporate governance refers to how a company makes its decisions. The direction, administration, and decision-making of any company is decided with the help of corporate governance.

There’s a lot that goes into corporate governance. Corporate governance can cover a variety of businesses decisions and topics, but nearly all their functions can be placed in one of the following five categories.