corporate governance and community

2. • Corporate governance is the system of rules,
practices and processes by which a firm is
directed and controlled.
• corporate governance also provides the
framework for attaining a company's
objectives.

3. • Corporation has grown up with industrialisation,
modernisation, and now globalisation.
• Only the corporation has been able to combine for
economic value certain financial capital, new
technologies, and human resources.
• A corporation is a set of relationships different
stakeholders .

4. Fundamental basis of corporate
governance
• Its human resource principles
• Its dedication to accurate and transparent
accounting and financial standards.
• Its concern for the environment
• Its over riding passion to serve customers
• Its insistence on fair treatment of suppliers
• Its uncompromising commitment
• Its desire to work

5. • Helps create competitive, modern and healthy
companies
• An effective tool against corruption
• Helps attract investment
• Helps foster healthy competition
• Helps prevent banking crises

6. • Confirm CEO/ Board commitment that priority to
responsible business comes first.
• State company purpose and agree on company values.
• Identify key stakeholders.
• Define business principles and policies
• Establish implementation procedures and
management systems.
• Bench mark against selected external codes and
standards.

7. • Set up internal monitoring
• Use language that everyone can understand
• Set pragmatic and realistic objectives

9. • Most scholarship on corporate governance in the last two
decades has focused on the relationships between
shareholders and managers or directors.
• Neglected in this vast literature is the role of employees
in corporate governance.

10. • An organization needs capital and labour to create
wealth.
• Earlier, the most important need for an organization to be
a success was capital.
• But today, the growing recognition that human capital is
a source of competitive advantage has led to the
understanding that labour is more important than capital.

11. The interest of the employees can be protected through,
• Trade Unions.
• Co-determination: employee representation on boards of
directors.
• Profit-sharing.
• Equity-sharing.(ESOP)
• “Team production” solution: Boards of directors must
balance competing interests

12. There are some guidelines that could be used here while deciding on
employee representation in an organization.
 Voluntary participation
 Extend benefits to all employees
 Clarity and transparency
 Predetermined formula
 Regularity
 Avoiding unreasonable risk for employees
 Clear distinction
 Compatibility with worker mobility