CH PAHANI TEJASWI (118916) VENY (11825) V ARVIND KUMAR (118926)

It refers to the relationship among the three groups which determining the direction and performance of the corporation. Those groups are: 1) Board of directors 2) Top management 3) Share holders

Corporate Governance is the system by which companies are directed and

controlled
(Cadbury Report (UK), 1992A)

Canadian Definition
The process and structure to direct and manage the business and affairs of the corporation with the objective of enhancing shareholder value, which includes ensuring the financial viability of the business.
Where were the Directors? Guidelines for Improved Corporate Governance in Canada, TSE, 1994

Corporate Governance

Leader ship for efficiency Leadership for probity Leadership with responsibility's Leadership which is transparent and which is accountable

Better governance does lead o higher credit rating and stock prices. Good governance leads to better performance over time. Good governance reduces he risk of the company getting into trouble. Governance is a major strategic issue.

Director are subjected to their duties obligations and responsibilities. Ac in the best interest of the company To give direction to the corporations. To remain accountable to the shareholder and all other stakeholders. To build up an environment of trust and confidence amongst those having competing and conflicting interest .

The board of direst is the highest governing authority with in the management structure of the company. In India the operation of a company managed under the direction of board with in frame work set by the company Act.1956. The board of directors therefore has an obligation to approve al decisions that might affect the long term performance of the corporation.

Setting corporate strategy, overall directions, mission, or vision. Hiring and firing the CEO and Top Management. controlling, monitoring, or supervising top management. Reviewing and approving the use of resources. Caring for shareholders interests.

Monitor Evaluate and influence Initiate and determination

Members - Inside directors

management directors Officers or execs employed by the firm non-management directors Execs of other firms not employed by the boards corporation

Outside directors

When Outsiders can be considered Insiders

Affiliated Directors Retired Directors Family Directors

Executive director Non Executive director Nominee director Representative director Shadow director Associate director

Board of Directors Continuum

Agency theory: Agency Problem Objectives of owners & agents in conflict Difficult for owners to verify agent performance

Risk Sharing Problem Owners & agents risk assessment in conflict

Executives more motivated to act in best interest of the corporation than their own self-interests. Theory that over time, senior executives tend to view corporation as extension of selves.

The top management function is usually conducted by the CEO of the corporation in coordination with the COO or president, executive vice president and vice president of division and functional areas.

Provide executive leadership and strategic vision. Manage the strategic planning process.

Executive leadership is the directing of activities toward the accomplishment of corporate objectives. Strategic vision is a description of what the company capable of becoming. 1) The CEO articulates a strategic vision for the corporation 2) The CEO presents a role for other to identify with and to follow 3) The CEO communicates high performance standards and also so confidence in the followers abilities to meet these standards.

CONCEPTS IN STRATEGIC MANAGEMENT AND BUSINESS POLICIES By THOMAS L. WHEELEN | J. DAVID HUNGER