Question

Corporate governance and implications of country level governance as it pertains to international finance?

Answer 1

Corporate governance can be defined as the system of rules, practices, and processes which helps in the developing the direction of an organization and the controlling of an organization. It serves as a framework for attaining a company’s objectives and is basically a technique and a framework by which companies are managed and are directed.

In the domain of international finance corporate governance assumes a high level of significance. This is because corporate governance at organizational level has a direct bearing and impact on the country level governance. The stronger the corporate governance framework for individual organizations the stronger will be the country level governance. Countries with strong governance frameworks and structures will be able to attract a higher portion of international finance and investments than countries with poor level of governance on a collective basis.