This presentation slides includes basic definitions to Corporate Governance (CG), Objective to Corporate Governance, Major Constituents of Corporate Governance, Participants to CG, Regulatory bodies in India for CG and Benefit of CG to organizations.

1. CORPORATE GOVERNANCE
Presented By:
Bimarsh Raj Giri
MBA 3rd Semester (Finance)
Roll. No: 15 (6)

2. What is CORPORATE GOVERNANCE ?
World Bank Group has defined Corporate Governance as the structures and processes by
which companies are directed and controlled.
Government of India has defined Corporate Governance as a set of systems, processes and
principles which ensure that a company is governed in the best interest of all stakeholders.
Fundamental Objective : Corporate Governance
To enhance shareholders' value and protect the interests of other stakeholders by improving
the corporate performance and accountability.
Good Corporate Governance is to ensure commitment of the board in managing the
company in a transparent manner for maximizing long-term value of the company for its
shareholders and all other partners.

3. Different forms of CORPORATE GOVERNANCE
Political Responsibilities
• Respect for the system of rights and principles of constitutional state
• Obligation should be abided by legitimate law
Social Responsibilities
• The corporate ethical responsibilities which the company promotes as a community or
part of community with shared value
Economic Responsibilities
• Acting in accordance with the logic of competitive market to earn profit on the basis of
innovation and respect for shareholder.

4. Participants of CORPORATE GOVERNANCE
Board of Directors
• Accountable to stakeholders and controls the management
• Set strategic aim and financial goals and oversees their implementation
Shareholders
• Appoint the directors and auditors to hold board accountable
• Monitor and evaluate the activities and progress of the company
Management
• Undertake the management of the company in terms of direction provided by the board
• Properly adopt the control system in the organization to ensure operation
• Report to the board on timely basis in transparent manner for accountability

5. Main Constituents of Good CORPORATE GOVERNANCE
• Role and powers of Board
• Legislation
• Code of Conduct
• Board Independence
• Board Skills
• Management Environment
• Board Appointments
• Board Meetings
• Strategy Setting
• Business and Community Obligation
• Financial and Operational reporting
• Monitoring the Board Performance
• Risk Management

6. Principles of Good CORPORATE GOVERNANCE
• Integrity: Integrity is generally understood to describe a person of high moral virtue.
• Fairness: Fairness refers to equal treatment to all shareholders should receive equal
consideration for whatever shareholdings they hold.
• Transparency: Transparency means the quality of something which enables one to
understand the truth easily
• Accountability: Accountability is a liability to explain the results of one’s decisions taken in
the interest of others.
• Responsibility: The Board of Directors are responsible for overseeing the management of the
business, affairs of the company, appointing the chief executive and monitoring the
performance of the company.

7. Benefits of CORPORATE GOVERNANCE
System of Good Corporate Governance allows sufficient freedom to the board and
management to take decisions towards the progress of the company and to innovate.
Global Exposure and Requirement: Corporation require to adhere, embrace and
demonstrate ethical conduct to have global exposure and to fulfil requirement to access
global pools of capital.
Good Corporate Governance offers credibility to the company to gain and maintain the
confidence of investors- both foreign and domestic- to attract more long-term capital.
Corporate Governance promotes fair and transparent behaviour towards various
stakeholders and maintains the integrity of the company.

8. Regulatory Framework for CORPORATE GOVERNANCE(INDIA)
The Companies Act, 2013
• Section 134, mandates to attach a report to every Financial Statement by Board of Directors
entailing the matters including statement containing director’s responsibility.
• Section 135, requires practice of Corporate Social Responsibility with certain descriptions
• Section 149, mandates appointment of Independent Directors
• Section 166, stipulates certain duties and liabilities upon Duties of the Directors
• Section 177, requires Board of Directors of listed company or any other class of committee to
constitute an Audit Committee.
• Section 184, mandates the Director disclose his interest in any company, corporate, firms .

9. Regulatory Framework for CORPORATE GOVERNANCE
Securities and Exchange Board of India (SEBI)
• SEBI exists to discourage the malpractices in the market operation and to protect the interest of
the stakeholders.
• Listing Obligations and Disclosure Requirements (LODR) 2015 requires listed entities to make
disclosure and abide by the provisions of these regulations
Institute of Chartered Accountants of India (ICAI)
• Ensures integrity and accountability in the corporate towards financial and accounting policies
• Accounting standards provide guidelines for standard and fair representation of the corporates or
organization

10. Regulatory Framework for CORPORATE GOVERNANCE
Institute of Company Secretaries of India (ICSI)
• Operates under Company Secretaries Act, 1980. It is a body to regulate and develop the
profession of Company Secretaries in India.
• It issues secretarial standards as per the provision of Companies Act 2013.
Organization for Economic Co-operation and Development (OECD) helps to build an environment
of trust, transparency and accountability necessary for fostering long-term investment and financial
stability.
Investor Education and Protection Fund (IEPF)
National Foundation for Corporate Governance(NFCG)

11. CORPORATE GOVERNANCE in INDIA
• Corporate governance gained its prominence in India after the Liberalization in 1991.
• In 1997, at Annual Session of Confederation of Indian Industry(CII) presented the draft
guidelines and code of Corporate Governance.
• In 1998, Desirable Corporate Governance Code was published.
• SEBI codified a mandatory Clause 49 of the listing agreement which made adherence to
corporate governance norms mandatory.
• In 2002, committee was appointed by Department of Company Affairs with recommendations
for financial and non-financial disclosures, auditing, board oversight of management etc.
• Satyam Computer Services scandal in 2009 required reassessment in corporate governance.
• The Companies Act 2013 made the Corporate Governance domain mandatory.

12. THANK YOU