Failure Of Corporate Governance

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The corporate governance is one of the major and important parts of any company law in the world. It is a system which determines the method and process of managing the company. The good corporate governance not only helps with the growth of the company but it also maintains transparency. Transparency gives confidence to the domestic investors as well as other international institutional investors. International institutional investors are the major players in the securities market. The market integrity increases the inflow of the foreign exchange to our country. On the whole the good corporate governance is very significant for the nation’s development. It is now time to understand the other one i.e. the failure of corporate governance. Failure…show more content…
Maintaining good corporate governance without any flaws and frauds is one of the key roles played by every director. The non-independence of the director is one of the biggest threats to the corporate good governance. Non-independence will affect the core role played by the director i.e. independent decision making. Many times the external influence is against the minority shareholders. Though, the concept of independence of director is continuously insisted by various scholars and eminent persons, achieving the same is still a myth in India. Thus, the dire need for independent director comes to play. Though the phenomenon of independent director is very old in various other countries such as U.S., U.K. etc, but in India the need for the independent director was only felt in the year…show more content…
Without the good corporate governance, the good management does not exist. Thus it is the foundation part of this thesis to be analyzed in detail. Directors are the key to open the doors of the good corporate governance. Independence of the directors is the gem in the crown of corporate governance. Maintaining director’s independence is the basic aspect for a good corporate governance system. One can quote various merits for the independency of the director. Some of them are; it represents minority share holders, it maintains utmost transparency in the management, it raises the investor’s confidence etc. The independence of the directors has been continuously curtailed by various managerial and non managerial persons. Independent director is a phrase which has many meanings and connotations. There is no universally accepted comprehensive definition available. It touches upon various branches of corporate law regime. The demarcating line between the director’s independence and the independent director is very blurring that it needs to be discussed in detail. There are various countries’ that are already having stringent provisions to protect the director’s independence as well as for the independent director. At the same time in India, appointment of independent director is a merely a qualification procedure to list a company’s securities in the stock exchanges. Overall there are various

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