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Corporate Governance: Learn more about it from Mr.

Ashok Gosain
By Gagan Deep Singh Sethi (110A24) Starting in 1991 in Delhi, MEC Group of Companies earns huge amount in revenues every year. The company has maintained a consistent growth and built a global company providing turnkey services. There are many businesses that succeed-the unique factor about MEC Group of Companies is in just over two decades it has built a brand known for ethical standards both inside and outside in the marketplace. The hypothesis of this paper is that corporate ethics promotes and inspires competitive advantage in a burgeoning marketplace. Talking to Mr. Ashok Gosain M.D. of MEC group of companies I tried to find out more about Corporate Governance and its importance in today s world. (1) What does corporate governance mean to you? Ethics in Corporate governance means the parameters which a company sets for itself for its functioning. Transparency and disclosures about accounts as well as other important issues have to be communicated to the stakeholders in a truthful and prompt manner. These build up confidence and trust in the marketplace. As consumers are getting increasingly aware of ethical issues, corporations have to respond to their concerns whether it is related to issues of environment, heath or any other concern. (2) Are there any corporate governance principles? By making business ethics its unique selling proposition, a company can accelerate its profit making process. Clause 49 of the Listing Agreement to the Indian stock exchange has been formulated for the improvement of corporate governance in all listed companies. Business ethics incorporates certain issues and principles like transparency, accountability, honesty and trust. (3) Are these principles interlinked? All these are interlinked. If the stakeholders believe that the entity they are dealing with is transparent, accountable for its actions and honest in its dealings, it will build up trust. Without a proper cohesion among these interlinked factors, it is difficult to survive in an expanding complex business environment. (4) Are these principles relevant to all the companies? This is more relevant in case of multinationals. When companies move to other nations in search of revenue and non saturated markets, ethics can build and sustain a reputation. The challenge of operating in foreign markets is now more

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daunting because they now exist in an alert media landscape where accountability for corporate actions is greater. (5) Do companies in India follow the concept of corporate governance? As Indian companies compete globally for access to capital markets, many are finding that the ability to benchmark against worldclass organizations is essential. For a long time, India was a managed, protected economy with the corporate sector operating in an insular fashion. But as restrictions have eased, Indian corporations are emerging on the world stage and discovering that the old ways of doing business are no longer sufficient in such a fast-paced global environment. (6) How important is corporate governance for any business? A business, which wants to survive long term and also generate good revenue, has to achieve market credibility by making brand loyalty as its main goal which can only be achieved by following ethical standards. Developing ethics will not stop unethical behavior but the efforts to follow such standards will be perceived by the people. The track record to follow such rules is vital for developing long term relationships with employees, investors, investors, clients, stockholders. If ethical is allowed to grow, it inspires stakeholders and also marks a firm as performing its functions as a socially responsible entity. After talking to Mr. Ahoak Gosain we come to know that Corporate Governance is not

just a word it means a lot more than that. Corporate governance comprises of a set of processes, policies and laws that impact the way in which a company is administered. Corporate governance gives importance to shareholders' welfare and also includes the relationships between the strategic goal of the company and its stakeholders. This relationship helps to sustain the business for a longer period. A company starts from scratch, becomes a million or billion dollar enterprise, goes from national to international level by following the principles of corporate governance, these principles may differ from company to company. Though this path of corporate governance seems to be tough but it is surely fruitful in long term prospective.

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