Modern Corporate Governance and Corporate Image

Sergei Zainullin 
Modern  
Corporate Governance 
and Corporate Image 
Monograph 
Moscow 
2025 

UDC [338.24+316.354]:2.012.324 
LBC 65.292.34-21+60.55-3 
З17 
Reviewers: 
M. V. Chernyaev, PhD, candidate of economic sciences, 
associate professor, Deputy Dean of the Faculty of Economics, Deputy head 
Department of National Economics, Peoples’ Friendship University of Russia; 
A. V. Dokukin, Doctor of Economics, Chief Researcher of the Federal State 
Budgetary Institution “All-Russian Research Institute for Civil Defense and 
Emergency Situations of the Ministry of Emergency Situations of Russia” 
(Federal Center for Science and High Technologies) 
Author: 
S. Zainullin — Professor of the Department of Advertising  
and Visual Communications Synergy University 
Zainullin, S. 
З17 
Modern Corporate Governance and Corporate Image : 
monograph / S. B. Zainullin. — Moscow : Direct-Media, 2025. —
244 р. 
ISBN 978-5-4499-4964-6 
The monograph examines methodological and methodological approaches to corporate governance in modern Russian conditions, principles, theories, and models of corporate governance in Russia and abroad. 
The activities of corporate governance bodies are described. Management cases and best practices of corporate governance are revealed. 
The relationship between corporate governance and corporate image 
is considered. 
The monograph is of practical interest to executives, administrative 
and managerial personnel, members of the Board of Directors, and 
shareholders of corporations. 
It may also be of interest to master’s students in law, economics, and 
management, postgraduate students, and university professors. 
UDC [338.24+316.354]:2.012.324 
LBC 65.292.34-21+60.55-3 
ISBN 978-5-4499-4964-6 
© Zainullin S., text, 2025 
© Publishing house “Direct-Media”, design, 2025 

Introduction 
Corporate governance is of great importance for society, 
since corporations are the main employers and taxpayers, bear 
the social burden, and the well-being and stability of both the 
states themselves and the peoples inhabiting them depend on 
the sustainability and stability of corporations. 
At the same time, a corporation is understood in a broad 
sense as a community of people united to achieve a common 
goal, which can include both a commercial corporation created to 
make a profit, and non-profit corporations — public, political, 
religious organizations that have a huge impact on the political 
and social situation in society. 
There is also an inverse relationship — crisis phenomena in 
the corporate environment cause global crises in the economic, 
political, social sphere, examples of which are enough — from 
the Great Depression of the 20s and 30s of the XX century, the 
trigger for which was the collapse of corporate stock prices on 
the stock market, to the crisis of 2008, which was launched by 
the crisis of corporations in the financial and insurance sectors. 
We also observed the collapse of the Russian stock market in the 
spring of 2023 as a result of anti-Russian sanctions and the rapid 
recovery growth of 2023, the global banking crisis of early 2023, 
which was extinguished by additional emission of dollars and 
euros and mergers and acquisitions in relation to the world's 
largest banks. 
We observed the same picture throughout the post-Soviet 
space in the 1990s, when the mass closure of manufacturing 
enterprises, including city-forming ones, the crisis of nonpayments, delays in wages for months or even years caused 
acute political and social problems — a drop in the population’s 
income, an increase in crime, a drop in the birth rate, mass migration of residents from their countries. 
And in 2022–2024, we are seeing similar crises in the energy and industry of the European Union as a result of the 

reverse effect of anti-Russian sanctions. These crises of European 
corporations cause a drop in the standard of living of the population of European countries and an increase in social tension. 
Thus, the importance of corporate governance issues continues 
to persist, and in light of the impending new wave of the global 
economic crisis and the revision of the “rules of the game” in 
corporate governance, the relevance is only increasing. 

Chapter 1. Corporate Governance: 
Definition, Meaning and Principles 
1.1. Approaches to Corporate Governance 
There are several approaches to defining corporate governance: 
 can be defined as an activity related to the functioning 
–
of a corporation; 
can be defined as a set of mechanisms used to maintain
–
an adequate balance between the rights of shareholders and the 
needs of the board of directors and management in the process 
of managing a company. 
The main task of corporate governance is to maintain 
a balance of responsibilities between interest groups. 
The key definitions will be those adopted by the OECD and 
the Bank of Russia. 
Corporate governance is defined as the relationship between the top management of a corporation, its board of directors, shareholders and other stakeholders. 
It defines the framework within which the corporation's 
objectives are set, the means of achieving these objectives and 
monitoring their implementation. 
Good corporate governance should create incentives for 
the board and administration to strive to achieve goals that meet 
the interests of the company and shareholders, and facilitate 
effective monitoring, thereby pushing firms to use resources 
more efficiently (OECD, “Principles of Corporate Governance”, 
1999). 
In 2014, the Principles were updated and formed into the 
G20/OEC Principles of Corporate Governance1. 
The Bank of Russia also provides a definition of corporate 
governance2. 
“Corporate governance is a concept that covers the system 
of relationships between the executive bodies of a joint-stock 
1 OECD (2016), Principles of corporate governance G20/ OECD, OECD 
Publishing, Paris.  
2 Letter of the Bank of Russia dated April 10, 2014 No. 06-52/2463 “On 
the Corporate Governance Code”. 

company, its board of directors, shareholders and other stakeholders. Corporate governance is a tool for defining the company’s goals and the means to achieve these goals, as well as 
ensuring effective control over the company’s activities by 
shareholders and other stakeholders.” The goals of corporate 
governance include:  
 ensuring the safety of shareholders’ assets; 
–
efficient use of shareholders’ assets;
–
reducing investor risks;
–
increasing the investment attractiveness of the compa–
ny and the value of its shares. 
The universality of corporate governance principles allows 
investors in different countries to understand the unity of corporate governance principles, understand the unity of the content 
of reports and the logic and procedures for decision-making by 
management bodies. The corporate governance system (corporate governance triangle) is presented in Fig. 1. 
Fig. 1. Corporate governance triangle 
The key elements of the corporate governance system are 
presented in Table 1. 

Elements of the corporate governance system 
(developed by the author) 
№ 
Stakeholder group 
Individual goals 
1 
Managers 
Maximization of wages, growth of company assets as an indicator of their professional qualifications, growth of staff, 
private benefits 
2 
Employees 
Maximization of wages 
3 
Consumers 
Maximization of consumer benefits from 
exchange 
4 
Commercial partners 
Maximization of operating profit from 
the implementation of contracts with 
the corporation 
5 
Financial intermediaries 
and providers of financial 
resources 
Maximization of operating profit 
6 
Bond holders 
Maximization of wages 
The corporate governance system and its basic elements 
also include a balance of rights and responsibilities of the elements. For example, the Board of Directors to shareholders, 
management to the Board of Directors, owners of large blocks of 
shares to minority shareholders, corporation to society. 
1.2. The Importance 
of Corporate Governance 
The creation of corporate governance as a system and the 
maintenance of its functioning incurs such costs as: 
 expenses for specialists — to create a corporate gov–
ernance system; 
payment of remuneration to periodically attracted ex–
ternal auditors and consultants; 
costs of public disclosure of information;
–
time costs of members of the Board of Directors and top
–
managers, especially at the initial stage. 
The advantages of implementing corporate governance are 
presented in Fig. 2. 

 
Fig. 2. Benefits of implementing corporate governance  
(developed by the author) 
 
Easing access to the capital market allows attracting different sources of financing, and accordingly reducing the cost 
of attracted capital (Table 2). 
 
Table 2  
Sources of financing for the corporation (developed by the author) 
Company’s 
own funds 
Borrowed funds 
Raised funds 
Indirect financing 
1 
2 
3 
4 
Enterprise 
profit 
Loans from 
commercial 
banks, credit 
institutions, 
institutional 
investors 
Issue and placement 
of shares 
Preferential loans 
through government 
guarantees 
Authorized 
capital funds 
Bonds 
Direct investments 
of the state, domestic and foreign 
private sector in the 
form of direct 
investments, grants 
of various funds, 
investments of 
business angels, 
venture financing, 
etc. 
Tax incentives for 
innovative projects in 
various forms (tax 
holidays, tax credits, 
accelerated depreciation) 

4 
Depreciation 
fund funds 
Mortgages 
Crowdfunding 
Rent incentives 
provided by technology parks, business 
incubators, etc. 
Enterprise 
development 
fund funds 
Forfaiting 
 
 
Insurance 
compensation 
Leasing 
 
 
Funds from 
the sale of 
excess assets 
 
 
 
Targeted 
receipts 
 
 
 
 
Let’s take a closer look at the sources of corporate financing that are most affected by the presence of an effective corporate governance system. 
Corporate bonds are a debt instrument — companies 
practically receive a loan from bond buyers for the life of the 
bond. There are short-, medium- and long-term bonds. Bonds are 
widely used to finance the activities of companies. In order for a 
company to be able to place bonds on the open market, the company must comply with the requirements of the legislation on 
securities markets, for this it is necessary to disclose a large 
amount of information about the company’s activities, prove the 
legality and transparency of its activities, approve the bond issue 
project and gain access to one or another trading system. 
As a rule, successful companies with a good history of operations, transparency in the disclosure of information, which in 
the eyes of buyers reduces the risk of default on bonds, can 
actually place their bonds. 
Leasing is the acquisition of production assets from a lessor 
(machinery, equipment, vehicles, computers, industrial buildings, 
etc.), as well as intellectual property rights (licenses, computer 
programs, know-how, etc.) with their subsequent purchase by the 
lessee. Leasing makes it possible to acquire production assets 
without having to make large one-time payments. Assets can also 
be acquired by renting or leasing equipment, but leasing is cheaper 

because the company must immediately enter into a contract for 
the use of the equipment for, as a rule, two or more years. 
Leasing avoids the damage to cash flow that a purchase 
causes, and makes it possible to use capital for other, possibly 
more profitable operations. 
At the same time, leasing companies require lessees to 
comply with corporate procedures, in particular the proper 
procedure for approving a leasing transaction if this transaction 
is large or requires additional approval (Fig. 3). 
 
 
Fig. 3. Scheme of the leasing agreement 
 
Issue and placement of shares. Financing through additional issue and placement of shares is available for enterprises 
organized in the form of a closed or open joint-stock company. It 
is carried out in the form of public placement and targeted 
placement among individuals and companies. The first form is 
available to companies that are already stable in the market with 
an established reputation. Targeted placement is more typical