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Corporate Governance and International Best Practices

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Corporate Governance and International Best Practices
CORPORATE GOVERNANCE AND INTERNATIONAL BEST PRACTICES According to the institute for Corporate Governance, Dubai, CG is ‘the system by which business corporations are directed and controlled.CG has received special attention from all over the world after scandals at Enron Corporation (USA), The BCCI Bank (UK), the Harshad Mehta Share Scam (India), and Satyam Computer Services Limited (India). Furthermore, After the global financial meltdown (2007-10) it is evident that lack of stringent CG norms in counties has had made a severe impact on the economies, and it has become essential to understand and implement good governance as it offers to corporations a framework, which is established on basis of certain values, morals and ethics. Countries like India and China are the future attractions for investments and thus have to guard themselves for many further fraudulent incidents so that FII’S and other global corporations see these economies as safe zones to venture into businesses. As we are in the nascent stage of CG development and implementation, we must learn from the international players and implement better and calculative CG norms. Corporate Governance in USA: In the US, Sarbanes –Oxley Act 2002, provides the basic framework for the corporations and guides on important issues like, see through financial reporting, efficient internal controls and CG. They give more importance to transparent CG, based on effective boards, strong rights of shareholders, disclosures etc. The Public Company Accounting Oversight Board has been established, which monitors annually the standards and procedures of auditing of public companies falling under the securities law. It also aims at gurading investors’ and as well as public interest. Whistle-Blowing is promoted by SOX, 2002 and employees are encouraged to file a complaint against any fraud or wrong practice. Corporate Governance in UK: CG framework is guided by the Turnbull Combined Code and Companies Act.
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