Corporate governance involves the rules and processes by which companies are directed and controlled. It provides the framework for companies to achieve their objectives and serves stakeholders including employees, customers, suppliers, and the environment. While most research has focused on shareholders and managers, employees also play an important role in corporate governance. Protecting employee interests through mechanisms like unions, board representation, profit-sharing, and equity-sharing helps companies access human capital which is now more important than financial capital alone. Guidelines for employee representation include voluntary participation, extending benefits to all employees, transparency, predetermined formulas, and avoiding unreasonable risks for employees.

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