PRESENTED BY:

TAHA AHMAD
GILL.
HUZAIFA
MUSHTAQ.
CORPORATE GOVERNANCE

Corporate governance is a system by
which organization is directed & control
by senior officers. The governance
structure specifies the distribution of
rights and responsibilities among
different participants in the corporation
(such as the board of directors,
managers, shareholders, creditors,
auditors, and other stakeholders) and
specifies the rules and procedures for
PARTIES IN CORPORATE
GOVERNANCE

 CORPORATE
GOVERNANCE
PILLARS

 ACCOUNTIBILITY

Ensure that management is
accountable to Board.

Ensure that Board is accountable to

Shareholders.
 FAIRNESS

Protect shareholder rights.

Everyone should be treated equally.

 TRANSPERANCY

Ensure Timely, accurate disclosure
of Material's Matters.

Material matters: FINANCIAL

SITUATION, OWNERSHIP &
PERFORMANCE.
 INDEPENDENCE

Who work for shareholders.

They are in organizations but not work

for it.

Their interest is not Financial.

They look misconduct in organizations.

 IMPORTANCE OF
CORPORATE GOVERNANCE

Good corporate governance can help
companies ensure efficient use of resources.
To attract Investors.
To recognize stakeholder interests.
Less chances of Fraud.
Corporate governance plays a vital role in
underpinning the integrity and efficiency of
financial markets
CONTINUED

 POOR CORPORATE
GOVERNANCE

Poor corporate governance weakens a
companys potential.
Financial difficulties.
High chances of fraud.
Capital will flow.
 CADBURY REPORT
1994 UK

The Cadbury Report, which shows
Aspects of Corporate Governance, is a
report chaired by Adrian Cadbury that
sets out recommendations on the
arrangement of company boards and
accounting systems to mitigate
corporate governance risks and failures.
 BACKGROUND OF
CADBURY REPORT

Sir Adrian Cadbury chaired a committee
whose aims were to investigate the British
corporate governance system and to
suggest improvements restore investor
confidence in the system. The Committee
was set up in May 1991. The report
embodied recommendations on corporate
governance. The final report was released
in December 1992 and then applied to
listed companies reporting their accounts
after 30th June 1993. And it was made
 CADBURYS
REPORT COMPANY:

AN ORGANIZATION NAMED
SATYAM COMPUTERS
WHICH WAS AFFECTED BY
POOR CORPORATE
GOVERNANCE .
 ABOUT SATYAM
COMPUTERS LTD.

Satyam computer ltd. Was
established on June 24 1987. The
founder of organization was Mr.
Ramalinga raj. CEO of that company
at the time of scam was Mr. Rahul.
Satyam computers headquarters
was in Hyderabad.
 SATYAM CASE

Satyam case was not an easy issue.
It was involved in 14000 crore scam.
SATYAM Scam had been a great example of
poor corporate governance.
It had showed poor relation b/w
shareholders and employees.
This company is an example for other
companies to avoid poor governance.
Taking this scam as a role model, other
companies should implement good
governance in order to set up rules and
 SATYAM SCAM
DETAILS

SATYAM announced acquisition with two
parties namely MAYTAS properties and
INFRA company.
Due to adverse reaction from
institutional investors this partnership
collapse within 12 hours.
After the deal was aborted, Four of the
directors resigned from the board of the
company on the same day.
 DETAILS
CONTINUED

Governance issue arises in SATYAM ltd.
Because of non fulfillment of obligations
of a company to various stakeholders.
It shows poor relation between all
stakeholders.
An organization is obligated to pay all
taxes to government in time. But SATYAM
didnt pay their taxes to government.
 CONTINUED

It is well known that shareholders has a right
to get all information from an organization.
They have the right to be shown all financial.

In SATYAM case, the above obligations were

never fulfilled, the acquisition between two
companies were announced without consent
of shareholders

THE SHAREHOLDERS WERE CHEATED!!!!

 Financial
Statements of

Company.
Bank Balance (Rs.5042 cr)
Accrued Interest ( Rs. 376 cr)
Liability (1230cr)
Debtors (490 cr)
Revenue (2700 cr)
 NOTE:

THIS(SATYAM) COMPANY
WAS BANNED FOR 8 YEARS
C
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