Abstract:
Previous attempts to measure the quality of corporate governance tend to focus on inputs of governance such as
the separation of the CEO and the chairman’s roles and the composition of boards, largely based on the agency
theory. The purpose of this paper is to examine the extent to which risk management can be incorporated into the
corporate governance framework on the backdrop of stewardship theory. After reviewing some of the key issues
from literature, the paper demonstrates how relevant risk management practices are to the governance of the
SME sector. It also made clear that both corporate governance and risk management have a positive relationship
with financial performance. In the end, it advocates for the need for both practitioners and researchers to pay
attention to issues of risk management when analyzing the extent to which corporate governance principles are
being adhered to by business organizations
