Corporation means a company and governance means the procedure by which any organization is operated and controlled. Therefore, corporate governance deals with how the corporations are controlled, operated, directed, and rules and regulations relating to the same.
IMPLICATIONS OF GOOD AND BAD CORPORATE GOVERNANCE
Good corporate governance helps the organization to help achieve its goals and objectives. The structure of the company needs to be built in such a way that it protects both, company’s interest as well as the interests of every person who is concerned with the affairs of the company.
The implications of bad or poor corporate governance can be drawn from the functioning of the corporation itself. If the company is found unable to deal with its day-to-day affairs effectively or if the interests of the stakeholders of the company are not taken care of and the company faces a financial crisis it can be said that the company was not well-governed.
PRINCIPLES OF GOOD CORPORATE GOVERNANCE
1) The Board of directors is responsible for controlling, managing, and directing the affairs of the company therefore they must do this effectively and fairly by ensuring that the rules and regulations are complied with.
2) Every individual working for the company must be clear about his duties and responsibilities so as to avoid conflict and overlapping of work. And they must be appointed with care, taking into consideration their knowledge and experiences.
3) The policies and procedures of the company should be transparent and known to every person concerned with the company’s affairs. Such as shareholders, debenture holders, etc.
4) Company needs to have a vision and objective and to fulfill this a proper strategy and procedures need to be implemented and the executive committee must work towards the same.
CORPORATE GOVERNANCE IN THE INDIAN CONTEXT
The companies act, 2013 replaced the old companies act of 1956. It provides for all provisions relating to corporations and various norms that need to be complied with. It is a set of guidelines that corporations need to follow from the day of its incorporation till the process of winding up (if/when a situation occurs).
Securities and Exchange Board of India (SEBI), 1992 regulates stock and exchange and safeguards and protects the interest of parties. SEBI had set up a committee to take a step towards the improvement of the corporate governance of listed companies in India.
Confederation of Indian Industry (CII),2009 developed and promoted a set of rules and codes of corporate governance for Indian companies to adopt and follow.
The national foundation for corporate governance (NFCG) was set up by the Ministry of corporate affairs (MCA) in partnership with the Confederation of Indian Industry (CII), Institute of Company Secretaries of India (ICSI), and Institute of Chartered Accountants of India (ICAI) with the objective to promote better corporate governance practices in India. To create a good structure, ethics, and a framework for good corporate governance.
There are many other acts such as the Foreign Exchange Management Act, 1999, Industries Development and Regulations Act, 1951, Restrictive Trade Practices Act,1969 replaced by Competition Act, 2002 which highlight the principles regarding corporate governance.
I have always been against Glorifying Over Work and therefore, in the year 2021, I have decided to launch this campaign “Balancing Life”and talk about this wrong practice, that we have been following since last few years. I will be talking to and interviewing around 1 lakh people in the coming 2021 and publish their interview regarding their opinion on glamourising Over Work.
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