Challenges and Issues in Corporate Governance

Challenges and Issues in Corporate Governance - Challenges...

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Unformatted text preview: Challenges and Issues in Corporate Governance Scope of Corporate Governance Corporate Governance is concerned with holding the balance between economic and social goals and between individual and communal goals. The governance framework is there to encourage the efficient use of resources and equally to require accountability for the stewardship of those resources. The aim is to align as nearly as possible the interest of individuals, corporations and society. The foundation of any structure of corporate governance is disclosure. Openness is the basis of public confidence in the corporate system and funds will flow to centers of economic activity that inspire trust.-Sir Adrian Cadbury. Shareholders role in governance is to appoint the directors and the auditors. Poor corporate governance has ruined companies, sent directors to jail, and destroyed a global accounting firm and threatened economies and governments. e.g., Taj Company Cooperatives scandal Mohib Textile Mills Ltd Cadbury Report (1992) Wider use of INDEPENDENT DIRECTOR Introduction of AUDIT COMMITTEE Separation between CHAIRMAN and CEO Adherence to detailed code of BEST PRACTICES. OECD Principles of Corporate Governance, (1999) Protect rights of SHAREHOLDERS Recognize the rights of STAKEHOLDERS Timely and accurate DISCLOSURE Responsibility of the BOARD Scope of Code of Corporate Governance, 2002 The code provides a framework for efficient and transparent running of listed companies to enhance shareholder value....
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This note was uploaded on 03/07/2012 for the course FINANCE 245 taught by Professor Hameed during the Spring '12 term at IMSciences.

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Challenges and Issues in Corporate Governance - Challenges...

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