Question

What are key pressures on top management and governing boards of MNC in effectively managing a corporation and what are some of the influences of financial markets on corporate governance?

(in 500 words)

Answer 1

The major element of improving microeconomic efficiency is corporate governance. Corporate governance affects the development and functioning of all markets and it has a big impact on the on allocation process. It influence the behaviour and performance of firms, innovative activity, entrepreneurship, and the development of an active SME sector. When capital monility increases then corporate governance has become an important thing which affecting the industrial competitiveness of OECD countries. Meanwhile, in transition economies, privatisation has raised questions about the way in which private enterprises should be governed. It is thought that poor corporate governance mechanisms in these countries have proved, in part, to be a major impediment to improving the competitiveness of firms. there is no single model of corporate governance. Governance practices vary not only across countries but also across firms and industry sectors.

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