Journal Press India®

Corporate Governance: Is it an Effective Panacea for Ensuring Corporate Ethics?

Vol 4 , Issue 2 , July - December 2015 | Pages: 52-60 | Research Paper  

https://doi.org/10.51976/gla.prastuti.v4i2.421508


Author Details ( * ) denotes Corresponding author

1. * Ankit Saxena, Assistant Professor, Institute of Business Management, GLA University, Mathura, Uttar Pradesh, India
2. Anand Mohan Agrawal, Director, Institute of Business Management, GLA University, Mathura, Uttar Pradesh, India

Recent events advocate the fact that there is continuous decline in the ethics and values as far as States and corporate are concerned. This signifies that there is flaw in system of governance. Corporate Governance refers to the system through which the behaviour of a company is monitored and controlled.
This paper endeavors to explore the effectiveness of current corporate governance framework in ensuring corporate ethics. In this paper, with the help of various scholarly works in recent past, it has been tried to explore significance of corporate governance in corporate functioning, pros and cons of corporate governance and the probable solution to enhance the effectiveness of corporate governance
It has been derived that good corporate governance, adds to competitive advantage, leads to high firm value and fair pricing of shares, yields positive market price reaction, preferred by investors. Fundamental shortcomings of corporate governance framework revolve around implications in real implementation, lack of quality corporate governance practices, problem of dominant shareholders, Distortion in Managerial pay-offs, Divergence from prescribed code, and even Hurting the overall economic growth.
Some of the imperatives for strengthening corporate governance framework comprises of orientation towards investors’ protection, improving national standards of regulation to the best, obtaining optimum level of transparency, reducing information asymmetry, enhancing role of media, and controlling managerial distortion resulting from stringent regulation.

Keywords

Corporate Governance, Dominant Shareholders, Managerial Pay-Offs, Investors’ Protection, Information Asymmetry.

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