2. Corporate Governance
procedures and processes for how public and
private sector organizations are directed,
managed and controlled.
relationships between, responsibilities of and
legitimate expectations among different
stakeholders (Board of Directors,
management, shareholders, and other
interested groups).
Stakeholders include any actor who has a
‘stake’ in a company rather than simply
owning its legal ‘stock’: employees,
customers, suppliers, communities,
government and society at large.
3. Why Corporate Governance?
To prevent managers from abusing the power
that shareholders have granted them to
represent their interests.
Good corporate governance serves as a
framework to secure investor confidence,
enhance access to capital markets, promote
growth and strengthen economies.
By providing for clear ‘rules of the game’ and
‘checks and balances’, corporate governance
systems help to lower company costs (for
capital and production) and increase
economic output.
4. Ethics
An individual's moral judgments about right
and wrong
Branch of knowledge deals with moral
principles
E.g.:
Helpless boy asked “priest I will give you
an apple if you tell me where god is?”
Priest replied “I will give you two if you
tell me where he is not?”
5. corporate ethics
Corporate social responsibility
The Triple Bottom Line (planet, people,
profit)
“Fair trade”
Sustainability
Corporate governance
6. Importance of ethics in
business
Ethical behavior and corporate social responsibility
can bring significant benefits to a business.
attracting customers
reduces labor turnover and talent retention
attracting more employees
attracting investors and keep the company's
share price high
Creates goodwill of company
7. Ethical values and Norms
Broad definition of good and bad; but not
necessary to follow.
The group of standers, or qualities,
characteristics, or ideas that
determine a person’s view of the
world.
Those standers are likes, dislike,
viewpoint, inner inclination, rational
and irrational judgments etc.
8. Norms
Exception of proper behavior rather the
requirement: ways in individual expects
all the people to act in given situation.
More or less followed value are norms;
Written or not written
Waiting in queue : NORM
Wrong to take other people’s property:
VALUE
9. Purpose of ethical
values in organization
Value serve as standards of behavior
Guidelines for decision making and conflict
resolution
Value effect out thought and action
Influence on motivation and perception
Influence on attitude and behavior
10. Establishing a strong ethical
culture
Lead by example
Establish a code of conduct
Implement an ethics training program
11. Potential payoffs for establishing a
strong ethical culture
Potential avoidance of fines
Better access to capital
Decreased vulnerability
Improved brand reputation
Improved customer loyalty
Improved employee commitment
12. Anti-Corruption Law
Corruption Prevention Act, 2002
Commission For Investigation of Abuse of Authority Act,
1991
Judicial Council Act, 1991
Special Court Act, 2002
Revenue Leakage (Investigation and Control) Act, 1995
Good Governance (Management and Operation) Act, 2007
Anti-Money Laundering Act, 2008.
Rights to Information Act, 2007.
Public Procurement Act, 2007.
Army Act, 2006.
13. Relation between
corruption and CG
strong relationship exist between the level of
corruption in rapidly developing economies and
corporate governance processes therein.
in countries with high levels of corruption, firms
lack efficient corporate governance practices.
Similarly, countries with deficient corporate
governance practices and low levels of compliance
to these standards breed corruption leading to a
wide range of transparency dilemmas
enforcing disclosure and reporting requirements in
a continuous and consistent manner will be the
only way to fight against corruption
14. Relation with CG Cont..
disclosure not only increases
transparency, but also increases firm
value which in turn increases stock prices
and reduces agency costs.
Therefore increased disclosure levels may
lead to increased credibility and less
corruption
15. Some major features of
Nepalese Bureaucracy
Patronage and political influence on transfer and appointment
to higher positions in civil services.
Nepal civil service is characterized by a culture of impunity.
Government officials are not easily accessible to public.
Civil service system is subjected to the undue political
pressure.
The bureaucracy lacks ethical leadership and environment to
promote such a leadership.
16. Conclusion
only good corporate governance helps to economic
and social development of any countries.
corporate governance system in Nepal is directly
affected from the political environment.
corruption leads to poor corporate governance.
