SUB: - CORPORATE GOVERNANCE
TOPIC: CORPORATE GOVERNANCE IN INSURANCE SECTOR.
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| Definition Of Corporate governance.Introduction of C.G.Introduction of InsuranceConcept of Insurance / How Insurance worksWhat is IRDA?Need For Corporate Governance In Insurance Sector.Corporate Governance Guidelines For Insurance CompaniesInsurance Companies’ Comments on the New Corporate Governance Code.Conclusion.
Corporate governance is the set of processes, customs, policies, laws, and institutions affecting the way a corporation (or company) is directed, administered or controlled. Corporate governance also includes the relationships among the many stakeholders involved and the goals for which the corporation is governed. The principal stakeholders are the shareholders, the board of directors, employees, customers, creditors, suppliers, and the community at large. Corporate governance is a multi-faceted subject. An important theme of corporate governance is to ensure the accountability of certain individuals in an organization through mechanisms that try to reduce or eliminate the principal-agent problem. A related but separate thread of discussions focuses on the impact of a corporate governance system in economic efficiency, with a strong emphasis on shareholders' welfare. There are yet other aspects to the corporate governance subject, such as the stakeholder view and the corporate governance models around the world. There has been renewed interest in the corporate governance practices of modern corporations since 2001, particularly due to the high-profile collapses of a number of large U.S. firms such as Enron Corporation and MCI Inc. (formerly WorldCom). In 2002, the government passed the Sarbanes-Oxley Act, intending to restore public confidence in corporate governance.
Introduction of C.G.:-
The introduction of C.G. by the National Insurance Commission (NAICOM) will institutionalize ethical standards in the operations of insurance business in Nigeria, according to regulatory body. NAICOM said the code of ethics and corporate governance was to enforce transparency and accountability in the conduct of insurance business in Nigeria, binds all underwriting companies, brokerage and loss adjusting firms. It also prescribed punitive sanctions that may include removal of the management of the company, cancellation of registration, prosecution of the chief executives officers of the company involved in unethical conduct of insurance business. The Minister of State for Finance, Mr. Remi Babalola, said in Lagos at the Nigeria Insurers Association’ operator’s conference that the Federal Government would enforce strict and strong corporate governance in the insurance industry. His words: “The insurance sector, as part of the financial system is, no doubt expected to play a vital role as we continue to move the economy forward. The sector represents an important component in the financial intermediation chain and remains the backbone of Nigeria’s risk management system”, he said. He said that the insurance sub-sector was more important than banking, adding “that insurance is the foundation of banking.” If the sector was very strong, he opined, that the economy would move faster because it will allow innovation to take place and for people to take risk.
Introduction of Insurance
Insurance provides financial protection against a loss...
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