Professional Managerial Skills

• The growth of a company comes with the demand for different skills to manage the operations of the company, meaning that the owners of a company may not entirely have the necessary skills and experience needed for certain managerial roles. Creating a management team separate from the ownership enables the company to be run by professionals who have diverse skills such as in marketing, corporate financing, public relations, among others.
  
  

Ease Performance Appraisals

• Performance appraisals are an essential part of good corporate governance as they enable managers to evaluate the company and to point out areas of improvement. It can be complex to evaluate performance where there is a lack of separation of ownership and management. But separation makes it easier for the board and those in management to be evaluated objectively. Owners are able to freely deal with the chief executive officer and other senior managers, even after the appraisals.
  
  

Capital Utilization

• Capital utilization involves the arrangements that determine the way in which resources and assets are managed in a company. Separating personal assets and liabilities from the business assets and liabilities may prove to be difficult for company owners. Managers come in to devise ways in which business assets are managed to generate the highest profits for the all shareholders.
  
  

Checks and Balances

• Separation of managers from owners in a firm ensures that a system of corporate checks and balances is in place. Managers act as a buffer between the company and stakeholders such that they can alleviate negative impacts of stakeholder activities and avoid hitches in public relations. Managers are well suited to put in place strategies that will lessen losses to the rest of the stakeholders as a result of the actions of another stakeholder.