Corporate Governance Essay

Sir Adrian Cadbury (2002) stated that corporate governance is “the direction and control process within an organization”.

Corporate governance is a systematic approach of controlling and monitoring a business operation.

The term corporate governance has came to light in the 19th Century when the theory of separation of ownership and control developed. The idea was that shareholders want the safeguard of their assets and their business controlled by managers and directors. Therefore, they require proper accountability of the financial performance of their business.

Corporate governance examines the decision process in corporations. It can also be defined as a system and process that ensure accountability, probity and openness in the operation of a corporation.

Corporate governance entails the compliance of its various codes of conduct and Government Regulations. As such, companies are required to publish their business activities in their annual reports.

The Mauritius banking sector represents two-third of its domestic financial system. There are 19 banks in Mauritius with 173 branches over the country. Apart from domestic banks in Mauritius, there are also big and famous banks such as HSBC Bank, Barclays Bank, Deutsche Bank, Bank of Baroda, and others. Financial Services Authority (FSA), Banks of Mauritius and Code of Governance regulate banks in Mauritius.

Everyone in the organization should participate in achieving effective corporate governance. It ranges from shareholders to employees, as they are accountable in reaching the aim and objectives of their business.

Fink (1998) defined literature review as “a methodical, unambiguous and reproducible approach for identifying, analyzing and interpreting the research ...

... middle of paper ...

...the Mauritian economy he presented the draft code.

He also mentioned that corporate governance should emphasize in improving accountability, transparency and fairness to all stakeholders. Moreover, he also added that good governance depends on cultural ethics, integrity and responsibility of the Mauritian society.

He further said that corporate governance should emphasize in improving accountability, transparency and fairness to all stakeholders. Moreover, he also added that good governance depends on cultural ethics, integrity and responsibility of the Mauritian society.

Sophastienphong and Kulathunga (2008), state that corporate governance helps in achieving banking efficiency, mitigating financial risk and improving stability.
They listed the four main concepts of corporate governance as:

1. fairness
2. transparency
3. accountability
4. responsibility