System Of Corporate Governance In Montenegro

The subject of this paper is the study of corporate governance system in Montenegro. The paper analyzes the corporate governance reforms that occurred after 2002 when Montenegro began independently to regulate the area of company law and corporate governance. The author points out that the system of corporate governance in Montenegro has developed in specific circumstances. The lack of longer existing shareholder practices, under-developed legal and institutional framework and the lack of understanding of the importance of good corporate governance were basic limits to its development. On the other hand, from the very beginning of independent regulation of company law and from the beginning of solving the problem in a field of corporate governance in Montenegro, there was a serious intention to create a framework of corporate governance that will satisfy the interests of all stakeholders in the shareholding companies. The starting point of this paper is that the system of corporate governance in Montenegro is in the phase ofits development. The author believes that in addition to formal compliance between the institute of corporate governance and adopted international standards is necessary to provide and apply the principles adopted in practice. The author has analyzed the historical development of shareholding companies in Montenegro, explained the basic features of corporate governance systems, and pointed to major deficiencies in its functioning in practice. The ultimate goal of this study was to identify the main deficiencies and to indicate the future directions to develop a system of corporate governance in Montenegro.