Corporate governance is:

a. a group of elected individuals whose primary responsibility is to act in the owners' best interests by formally monitoring and controlling the firm's top-level managers.
b. the set of mechanisms used to manage the relationships among stakeholders and to determine and control the strategic direction and performance of organizations.
c. a means by which firms collaborate to achieve a shared objective.
d. a structure in which the owner-manager makes all major decisions and monitors all activities, while the staff serves as an extension of the manager's supervisory authority.

b. the set of mechanisms used to manage the relationships among stakeholders and to determine and control the strategic direction and performance of organizations.