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DEPARTMENT OF MGMT & TECHNOLOGY

   

 
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‡ Corporate governance is the set of processes, customs, laws
and institutions affecting the way a corporation or company is
directed, administered or controlled. Corporate governance
also include the relationships among the many stakeholders
involved and the goals for which the corporation is governed.
It¶s concerned with the moral ethics, values, parameters,
conducts and behavior at the company and it¶s management.
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‡ Enhancement of stakeholders value keeping in view the interest
of other stakeholders.
‡ Utilize funds taken from financial institution and the capital
market in the purpose for which they were intended.
‡ Develop core competency to effective manage it¶s
diversification.
‡ Manage and check the diversification of funds by the way of
loans, advances or investment to subsidiary or investment
companies.
‡ Control over the bad practices.
‡ Conduct ethical and four practice towards it¶s shareholder,
customers, suppliers, employees and public at large.
     

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   D The board of directors,
with its legal authority to hire, fire and compensate top
management, safeguards invested capital. Regular board
meetings allow potential problems to be identified, discussed and
avoided.
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    D Internal
auditors are personnel within an organization who test the design
and implementation of the entity¶s internal control procedures
and the reliability of its financial reporting.
 

  D This application of separation of power is
further developed in companies where separate divisions check
and balance each other¶s actions.



D Performance-based remuneration is designed to
relate some proportion of salary to individual performance. It
may be in the form of cash or non-cash payment such as shares
and share options, superannuation or other benefits.
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External corporate governance controls encompass the
controls external stakeholders exercise over the organization.
Examples includes D
‡ Competition
‡ Debt covenants
‡ Demand for and assessment of performance information
(especially financial statements )
‡ Government regulations
‡ Managerial labour market
‡ Media pressure
‡ Takeovers
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È D In corporations, the shareholder delegates
decision right to the manager to act in the principals¶ interests.
A system of corporate governance controls is implemented to
assist in aligning the incentives of managers with the those of
shareholders.
  
   D A board of directors often plays a key role in
corporate governance. It is their responsibility to endorse the
organization's strategy, develop directional policy, appoint,
supervise and remunerate senior executives and to ensure
accountability of the organization to its owners and authorities.
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D The company secretary is highly ranking
professional who is trained to uphold the highest standards of
corporate governance, effective operations, compliance and
administration.