Importance Of Corporate Governance In Business Ethics

Corporate Governance: - Business Ethics

Abstract:

Human beings are continuously engaged in some activity or other in order to satisfy their unlimited wants. Every day we come across the word “business” or “businessman” directly or indirectly. Business has become an important part of life. A business is an organization where people work together. A business can earn a profit for the products and services it offers. Corporate governance broadly refers to the mechanisms, processes and relations by which corporations are controlled and directed.

Ethics are the basic concepts and fundamental principles of decent human conduct. It includes study of universal values such as the essential equality of all men and women, human or natural rights,

It gives rules and regulations, by which the Board of directors ensures that the organization is loyal, accountable, and transparent to towards the relationship, which it shares to its different stakeholders like customers, employees, management, financial consultants, government bodies and other important communities. As the main aim of any business organization is to make high profits. But now these days it’s not enough to make high profits only, it also needs to be a good corporate citizen in the society, to behave in ethical manner and must have some healthy corporate governance enactment.

The Quality of any business organization’ corporate governance affects the value and the risk of the organization. Strong corporate governance is required for the effective and efficient of any business organization to stay in the market.

Objectives of Corporate Governance:-

• To ensure that the company is effectively and efficiently using its all assets and resources and proving best interest to his stakeholders and investors.

• To obtain and secure the interest of all associated stakeholders.

• To abolish the dispute or disagreement between stakeholders and corporate

It helps to anticipate corporate frauds, scandal and any kind of liability to the company (Civil or criminal).

Share information of the company: - It helps to share the philosophy, culture, practices, and its employees. It also helps to build a good image of the company in the eyes of people. It shows its respect and responsibility towards all the stakeholders and shareholders.

Important to fulfill social responsibility: - In today’s world for the survival of any company it’s very important to be socially responsible. The boards of directors are responsible to protect the rights of stakeholders, employees, customers, government bodies, suppliers, and other communities. These entire things depend upon the use of corporate governance.

SEBI Norms: - SEBI (The Securities and Exchange Board of India) has declared Corporate Governance mandatory for few companies. As it is important for the protection of the rights of the stakeholders and investors. It focuses on the primary role of board of directors as it’s an important link between management and