The document discusses corporate governance, defining it as a set of rules that govern company actions, ensuring transparency, accountability, and efficiency in management. It emphasizes the importance of corporate governance in India, highlighting its impact on investor confidence, economic growth, and compliance with legal frameworks such as the Companies Act of 2013 and SEBI guidelines. The document outlines key principles of corporate governance, including accountability, fairness, and transparency, along with the roles of various regulatory bodies in promoting good practices.

1. By
Dr.M.Devaki
Assistant Professor
Sri Ramakrishna College of Arts & Science
(Autonomous)
Coimbatore – 641 006
Corporate Governance

2. Corporate Governance
CORPORATE
GOVERNANCE
The act of the company that is used to
cater to the actions and affairs of the
company
Large Company or Group
Corporate Governance is a set of rules that is used to
govern the actions of the company. It ensures that the work of
the company is running smoothly, the company achieves its
objectives, and provides benefits to its shareholders,
employees, and workers.
The company caters to the needs of society with the
help of certain activities without hampering their employees.

3. Meaning
Corporate Governance acts as a focal point and
governs the company to follow transparency,
accountability, fairness, proper responsibility, and risk
management. It creates a set of rules that helps the
company properly supervise, and control the actions
of the company.
Corporate Governance refers to the way in which
companies are governed and to what purpose. It
identifies who has power and accountability, and who
makes decisions. It is, in essence, a toolkit that
enables management and the board to deal more
effectively with the challenges of running a company.

5. SCOPE OF CORPORATE
GOVERNANCE IN INDIA
 The scope of Corporate Governance in India includes
collecting processes, procedures, & provisions through which
the company operates & controls.
 It refers to the mechanism by which an organization manages
and directs its affairs.
 Business ethics play a vital role in Corporate Governance & it
is the substantial factor influencing Corporate Governance.
 The ideal model of Corporate Governance excels on the
globally accepted principles of corporate Governance.
 As per the ideal model, the company conducts its business as
per the stakeholder’s desire to reap profits.
 Board of Directors (BODs) and other associated committees
are accountable for running the company and maintaining a

6.  If the corporate governance of the company is proper it
will ultimately lead to better economic growth and more
success rate.
 Better corporate governance helps in getting the
confidence of the investor which will ultimately help the
company in raising and acquiring the capital fast and
effectively. It also lowers the cost of the capital that is
required for investment.
 It also helps in increasing the share price of the
company.
 Proper corporate governance help in attaining efficiency
and also minimizes mismanagement, risk, and
corruption.
 It plays in building up the goodwill of the corporation.
 It helps in managing and running the operations in the

7. 1.Accountability
2.Fairness
3.Transparency
4.Independence
5. Compliance with rules
1.Accountability
Accountability means a situation in which any person is
responsible and needs to give a satisfactory reason for
anything wrong in work. Corporate governance makes
accountability.
(a) Accountability ensures that working management i.e.
Managers, Employees is responsible to the Board Of
Directors (BOD).
(b) Further, Accountability Ensure that the BOD is
accountable to shareholders if anything bad happens.

8. 2.Fairness
(a) Corporate governance (CG) protects the rights of
Shareholders.
(b) CG treat all shareholders equally including minorities
(c) Provides effective redressal for any violations i.e
Customer care
3.Transparency
CG makes ensure timely, accurate disclosure on all
material matters of the company including the financial
situation, performance, ownership.
4.Independence
(a) CG makes procedures, rules, and structures in place
to minimize or avoid conflicts of interest
(b) CG appoints Independent Directors and Advisers i.e.
to take the free decision from the influence of others
5. Compliance with rules
(a)CG ensures compliance with all the laws and code of

9. FURTHER SCOPE
 Brings Honesty & Transparency
 Access Foreign Capital
 Protection of Investor
 Fairness In Financial Reporting and
accountability
 Improves shareholder Communication
 Increases Goodwill and market reputation
 Enhancing Company Valuation

10. LEGAL FRAMEWORKS OF
CORPORATE GOVERNANCE
 Corporate governance involves the laws, procedures,
practices, rules etc.
 In order to ensure good corporate governance in India
many regulatory frameworks are introduced.
The Companies Act, 2013
 The new Companies Law contains many provisions
related to good corporate governance like
Composition of Board of Directors, Admitting Woman
Director, Admitting Independent Director, Directors
Training and Evaluation, Constitution of Audit
Committee, Internal Audit, Risk Management
Committee, SFIO Purview, Subsidiaries
Companies Management, Compliance center etc.

11.  All such provisions of new Company Law are
instrumental in providing a good Corporate Governance
structure.
 Section 134, attach a report to every Financial
statement by Board of Directors.
 Section 177, which requires Board of Directors of every
listed company or any other class of committee to
constitute an Audit Committee.
 Section 184, which mandates the Director disclose his
interest in any company or companies, body corporate,
firms, or other association of Individuals.
The director is required to disclose any such
interest at the first meeting of the board and if there is
any change in the interest then the first meeting held
after such change.

12. Securities and Exchange Board of India (SEBI)
guidelines
 SEBI is a regulatory authority established on April 12,
1992.
 SEBI was established with the main purpose of curbing
the malpractices and protecting the interest of its
investors.
 Its main objective is to regulate the activities of Stock
Exchange and at the same time ensuring the healthy
development in the financial market.
 In order to ensure good corporate governance SEBI
came up with detailed Corporate Governance Norms.
1. As per the new rules the companies are required to
get shareholders approval for RPT (Related Party
Transactions), it established whistle blower

13.  Clause 35B of the Listing Agreement is being
amended by the regulatory authority.
Now as per the amended clause, Listed
companies are required to provide the option of e-
voting to its shareholders on all proposed or passed
at general meetings.
Those who do not have access to e-voting facility,
they should be provided to cast their votes in writing
on Postal Ballot.
 Clause 49 of the Listing Agreement was also
amended by SEBI in order to strengthen the
Corporate Governance framework for Listed
companies in India.
The revised clause forbids the independent
directors from being eligible for any kind of stock

14. SEBI also Implemented Various Regulations for
Effective Working of the Companies, few of these
Regulations are as follows
 SEBI (Issue of Capital and Disclosure Requirements)
regulation, 2009.
 SEBI (Listing obligations and
Disclosure Requirements), 2015.
 SEBI (Prohibition of Insider Trading) Regulations,2015.
 SEBI came up with many other regulations like
Regulation on Fraudulent and Unfair Trade Practices,
Regulations on Substantial Acquisition of Shares and
Takeovers, Issue of Sweat Equity etc.

15. Standard Listing Agreement of Stock Exchanges
 Accounting standards issued by the ICAI (Institute of
Chartered Accountants of India)
 ICAI is a statutory body established by Chartered Accountants
Act, 1949.
 It issues accounting standards for disclosure of financial
information.
 Section 129 of the Companies Act, 2013 states that financial
statements of a company shall comply with the accounting
standards notified under section 133 of the Act.
 Secretarial standards issued by ICSI (Institute of Company
Secretaries of India)
 It is an autonomous body constituted by the 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 the
Companies Act,2013.
Secretarial standard-1 on Meeting of the Board seeks to
prescribe a set of principles for conducting meetings of Board
of Directors.
Secretarial standard-2 prescribes a set of principles for

16. Thank you