Corporate

Governance
• C. NAGA PULLAIAH
• B. NAGA TEJA KUMAR
REDDY
• M. N. NAGA SAI
• S . NAVANEESHWAR REDDY
• K . NAVEEN KUMAR REDDY
• M . NAVEEN KUMAR
 Contents included in corporate
governance:
 Definition
 Role of corporate governance
 Why is it important…?
 Purpose of corporate governance
 Pillars of corporate governance
 Corporate governance principles
 Key elements of corporate governance
 Qualities of good governance
 Benefits of corporate governance
Definition:

 Corporate governance is the set of

processes, customs, policies, laws,
and institutions affecting the way a
corporation (or company) is
directed, administered or controlled.
 Corporate governance also includes
the relationships among the many
stakeholders involved and the goals
for which the corporation is
governed.
 Role of corporate governance:

 Corporate governance is the system by which companies are

directed and controlled.
The responsibilities of the board include :
 Setting the company's strategic aims
 providing the leadership to put them into effect
 Supervising the management of the business and reporting to
shareholders on their stewardship.
 Why is it important……?

 Proliferation of financial scandals and

crisis.
 Loss of trust of investors.
 Globalization lead to increasing cross-
border investment opportunities but
investors may not have knowledge about
the regulatory framework of overseas
investees.
 Purpose of corporate governance:

 The purpose of corporate governance is to

facilitate effective, entrepreneurial and prudent
management that can deliver the long-term
success of the company.
 Corporate governance is the system by which
companies are directed and controlled.
 Boards of directors are responsible for the
governance of their companies.
 Pillars of corporate governance:

 The pillars of successful corporate governance are: accountability,

fairness, transparency, assurance, leadership and stakeholder
management.
 All six are critical in successfully running a entity and forming solid
professional relationships among its stakeholders which include
board directors, managers, employees, customers, regulators and
most importantly, shareholders.
 Corporate governance principles:

 Accountability.
 Fairness.
 Transparency.
 Responsibility.
 The Company recognizes the rights of all interested parties
permitted by applicable law, and seeks to cooperate with
such persons or companies for their own development and
financial stability.
 Key elements of corporate
governance:
 Rule of Law.
 Good governance requires fair legal frameworks that are enforced by an
impartial regulatory body, for the full protection of stakeholders.
 Transparency.
 Responsiveness.
 Consensus Oriented.
 Equity and Inclusiveness.
 Effectiveness and Efficiency.
 Accountability.
 Participation.
 Qualities of good governance:

 All men and women should have a

voice in decision-making, either
directly or through legitimate
intermediate institutions that
represent their interests.
 Rule of law
 Transparency.
 Responsiveness.
 Consensus orientation.
 Equity.
 Effectiveness and efficiency.
 Accountability.
Benefits of corporate governance:

 Good corporate governance ensures

corporate success
 economic growth.
 Strong corporate governance
 maintains investors' confidence, as a
result of which, company can raise
capital efficiently and effectively.