The purpose of this study is to establish a literature review on corporate governance, corporate finance and innovation, demonstrating how various corporate governance structures internally can be variables of innovation in an organization. The study design is a theoretical review of studies conducted about corporate governance, corporate finance and innovation. The research is conducted by investigating ownership structure, the board of directors and corporate finance on the business innovation. The secondary research findings found the arguments about the influence of corporate finance and corporate governance on firm innovation, but no direct relationship is found among these variables. The interest in the influence of governance structures on decisions of management on innovation has risen in recent years. Innovation activities and outcomes are based on corporate governance considerations, e.g., ownership structure, roles of the board of directors and corporate finance. The study shows an advancement in business innovation and proposes a future empirical study on the correlation between further innovation and corporate governance.

Keywords: Corporate governance, Corporate finance, Innovation, Ownership structure, Board of directors