Correlation Between Corporate Transparency N Business Performance

Topics: Corporate governance, Corporation, Management Pages: 15 (3612 words) Published: November 19, 2011





transparency and business performance. Is there a relationship between good governance and on-going business practices? What criteria are or should be considered? Ranjitha Subramanya MBA 600 Capital University

Ranjitha Subramanya

MBA 600 Final paper



Abstract Corporate governance Organization for Economic Co-operation and Development (OECD) principles, objectives and standards. Transparency in doing business and its impact on the business performance. Background of good transparency. Transparency guidelines which can enhance the performance. Transparency’s impact. Corporate Governance Disclosure. Criteria to be considered for the strong relationship between good corporate governance and sound business practices. Conclusion

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Ranjitha Subramanya

MBA 600 Final paper


‘Corporate Transparency’ and ‘Corporate Governance’ are two important terminologies which are inter-dependent on each other. Every economy’s growth and its efficient resource allocation decisions are determined by the availability of information. The extent of information availability of a firm is an indicator of the firm’s governance. In recent times, the terms ‘governance’ and ‘good corporate governance’ have become buzzwords in the development discourse. Governance is defined as the act, process or power of governing. It also means the process of decision-making and the process through which decisions are implemented. Good corporate governance means ruling justly, enforcing laws and contracts fairly, respecting human rights and property rights and fighting corruption. What exactly is corporate governance? What is the relationship between corporate transparency and performance? What criteria should be considered for strong corporate governance and sound business practices? My paper sheds light on these questions by taking into account the various principles, factors and standards binding the relationship between corporate governance and business practices.

Ranjitha Subramanya

MBA 600 Final paper


Corporate Governance
Corporate Governance is not an abstract goal. It exists to serve corporate purposes by providing a structure within which stockholders, directors and management can pursue most effectively the objectives of corporation. The capacity of developing an effective model of corporate governance is a fundamental requirement for the development of an advanced economic system. The corporate governance helps to generate a long-term value transparently and effectively on a macro level (corporation level) as well as a macro level (a country’s economy). As a consequence, international organizations place growing attention on the definition of corporate governance, especially by promoting them in countries with recent involvement in the international competition. For example: In 1999, on the wave of Asian crisis, the Organization for Economic Co-operation and Development (OECD) endorsed a set of principles, standards and guidelines fostering corporate governance at the international level. Today this set of principles, revised in 2004, is considered to be the basic framework for a corporate governance discipline.






Development (OECD) principles, objectives and standards (1)
The OECD report on ‘Principles of Corporate Governance’ has the following objectives: Ranjitha Subramanya MBA 600 Final paper 4

To support governments in their process of creation and evaluation of institutional and legal framework of corporate governance.

To provide guidelines and suggestions to stock-exchanges, institutional investors, corporations and all others participating in the development process of a ‘good governance culture’.

The implementation of the OECD principles mainly refers to listed corporations, in order...
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