Question

What are the effects/impacts of the various "Basic Responsibilities" on governance?

Answer 1

The major aim of corporate governance is to ensure transparency and accountability towards shareholders and stakeholders. It ensures that the practices in an organisation are ethical by keeping in mind the sustainability of the corporation along with economic profitability. Corporate governance also ensures that the management is supervised and the reports are made with full transparency. There are clearly defined roles and responsibilities for various entities in an organisation that helps in setting the strategic roadmap for enhancing the capacities of the organisation. Some of the major impacts with the execution of basic responsibilities of corporate governance are:

• The performance of the organisation and the responsibility of the board of directors has enhanced.
• Harmonious relationship between the board of directors and executive management according to the principles set by corporate governance.
• Appointment and assessment of board of directors are done as per the norms in corporate governance rules.
• There is ethics in every activity of the company.
• Risk management team was allotted according to the corporate governance policies which help in managing the situations of crisis and risk in the organisation.
• The communication with the shareholders is made open and transparent by disclosing all the relevant information
• There is a considerable reduction in the window dressing of financial information and the reports are made with accurate data.

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