Presented By:

Dithun Paul
Harjot Singh
Mayank Agrawal
Mohd.Javed
Sanjay Sharma
An Overview…
Definitions.
What is Corporate Governance?
Importance of Corporate Governance.
Objectives of Corporate Governance.
Parties to Corporate Governance.
Enterprise Strategies.
Impact.
The Future.
Failure.
Conclusion.
 “Corporate governance is the
system by which companies
are directed and
controlled….”

-Cadbury Report
(UK), 1992
 “Corporate governance deals
with the ways in which suppliers
of finance to corporations assure
themselves of getting a return on
their investment.”

(Shleifer and
Vishny, )
 Some further Definitions…!!!

Corporate governance is essentially

about leadership:

 Leadership for efficiency.

 Leadership probity.
 Leadership with responsibility.
 Leadership which is transparent and accountable.
Portfolio of Corporate Governance ....
 A set of relationships between a
company’s management,
 Its shareholders and other stakeholders
 Its board,

..also the structure through which

objectives of the company are set,
and the means of attaining those
objectives and monitoring
performance are determined.
Importance of Corporate Governance

 Business prosperity and

accountability.

 Stakeholders with a relevant

interest in the company’s business
are fully taken into account.

 Prevention of malpractice and

fraud, although it cannot prevent
them absolutely
BJECTIVES
OF
RPORATE
VERNANCE
To build up an environment of trust and
confidence amongst those competing
and conflicting interest.

 To enhance shareholders’ value

and protect the interest of other
stakeholders by enhancing the
corporate performance and
accountability.
 Parties to Corporate
Governance

Responsible for the Powerful (in theory) because they elect

company’s daily operations board and vote at AGMs. In order to
and daily affairs. Provides exert influence, they should be:
and updates conditions and -committed
incentives for the -knowledgeable
company’s -long-term.

MANAGERS SHAREHOLDERS

BOARD OF DIRECTORS
The board is “the source and focus of proper
accountability of management to
shareholders.”
 “ Effec tive m ana gers l ive
in t he prese nt bu t
conc ent ra te on the
fut ure”
Enterprise Strategies :
 CUSTOMER VALUE.
 OPPORTUNISTIC.
 MAXIMUM UTILISATION OF RESOURCES.
 SWOT ANALYSIS.
 FOCUS ON COMPANIES EXTERNAL
COMPETITIVE ENVIRONMENT & INTERNAL
CAPABILITIES.
 Strategies cont……!!!

 SETTING UP OF NEW GOALS THROUGH

PROPER VISION & CREATIVE
THINKING.

 CUTTING EDGE OF NEW

TECHNOLOGIES.

 CONTANTLY EVALUATE YOUR

PERFORMANCE.
 IMPACT OF CORPORATE
GOVERNANCE

A Strong Corporate Governance:

 Strengthens the economy.
 Helps in Socio-Economic
Development.
 Technological advancements.
 Affects standard of living.
 The Triple-Bottomline Impact

ECONOMIC

Business Impact

ENVIRONMENT SOCIETY
 THE TRIPLE EFFECT ON SOCIETY

 ENVIRONMENT  ECONOMIC
 Sustainable  Product Value.
development.  Wealth
 Waste Control. Generation.
 Energy Usage.  Productive
Employment.

 SOCIAL
 Equal
Opportunities.
 Education &
Culture.
 Human Rights.
 The Future…!!!
Core Factors…towards FUTURE…!!!!
 Consequences of decision in the long term.
 Interest of the company’s employees.
 Need to foster the company’s relationship with
suppliers, customers & others.
 Desirability of the company maintaining a
reputation for high standards of business
conduct.
Factors Responsible for corporate Failure

 Directors may not have the proper skills

required of the corporate, allow management to
obscure problems.
 Directors appoint CEO’s which make it difficult
for them to evaluate the CEO’s performance
passionately.
 CEO’s tend to exercise too much influence over
the company’s board.
 Effect of Government hard-hitting policies.
 How to Overcome
Failures…
Management must be goal oriented.

A company should have a skilled

organizational structure (i.e. starting from
Board of Directors to Lower Level Of
Employees).

The internal environment of the firm should

be healthy.

Last but not the least

“Minimum Input & Maximum Output”.
 Some closing thoughts…!!!

• Right size of the Board and Its

Composition.
• More focus on oversight, Less on
Micro- Management.
• Having complementary skills.
• Respect Shareholders Rights.