P.

SNEHA
19BCP055
GOVERNANCE,RISKS &ETHICS
ASSIGNMENT -I
 CHALLENGES
FACED BY THE WOMEN
AS A
BOARD OF DIRECTORS
 Functions of a Board of Directors
A corporate board of directors acts as a fiduciary for shareholders.

• Creating dividend policies

• Creating options policies
• Hiring and firing of senior executives (especially the CEO)
• Establishing compensation for executives
• Supporting executives and their teams
• Maintaining company resources
• Setting general company goals
• Making sure that the company is equipped with the tools it needs to be
managed well
 BOARD OF DIRECTORS
• A board of directors is essentially a panel of people who are
elected to represent shareholders
• Every public company is legally required to install a board of
directors; nonprofit organizations and many private companies –
while not required to – also name a board of directors
• The board is responsible for protecting shareholders’ interests,
establishing policies for management, oversight of the corporation
or organization, and making decisions about important issues a
company or organization faces.
 STRUCTURE OF BOD
• The structure, responsibilities, and powers given to a board of directors are
determined by the bylaws of a company or organization. The bylaws generally
determine how many board members there are, how the members are elected, and
how frequently the board members meet. There’s not a set number or structuring for
a board of directors; it depends largely on the company or organization, the industry
in which the company or organization operates, and the shareholders.
• It’s widely agreed upon that the board needs to represent shareholder and
owner/management interests and that it’s usually a good idea for the board to include
both internal and external members.
• Accordingly, there is usually an internal director – a member of the board that is
invested in the daily workings of the company and manages the interests of
shareholders, officers, and employees – and an external director, who represents the
opinions and interests of those who function outside of the company.
• The law has made it
mandatory for companies
to appoint at least one
woman director on their
boards and the good news
is that it’s proven to be
effective.
• According to Prime
Database, 76 per cent of
the NSE 500 companies
now have a woman
director on their boards.
• The not-so-good news is
that many of them are
still struggling to make
an impact.
• The law has made it mandatory for companies to appoint
at least one woman director on their boards and the good
news is that it’s proven to be effective.
• According to Prime Database, 76 per cent of the NSE
500 companies now have a woman director on their
boards.
• The not-so-good news is that many of them are still
struggling to make an impact.
 CHALLENGES OF WOMEN BOD
• The 50% of the directors experienced onerous regulatory pressure and heavy in their
roles.Several women directors also experienced that it seemed more onerous because they had
little immunity and very few ways to protect themselves from the associated risk.
• Another challenge that was commonly faced by the women directors respondents was the
difficulty in overseeing the firms operational matters.
• This included specifics such as limited access to the firm’s operational data in board meetings,\
• and limited time available to review and comment on operational issues,and at times ,the rather
short duration of the meetings.
• The Women directors also faced challenges in overseeing the firms leadership management
decisions
• The challenges such as the board’s limited access to the company decision making process and
no mandate or culture of taking board approval for many critical decisions in the firm
• Highest proportion of women independent
directors was found in trading (22%).On this
score among the NSE 500 firms ,consumer goods
and IT sector (22%)were leading .Among the non
-independent directors in NSE-listed firms,the
lowest proportion of women is 8% for energy
industry ,and 10% for chemical industry
• As far as non-independent directors go,their
highest presence was the media and entertainment
and services industry at 20%
• Women were represented to a much less extent in
industries such aa energy (13%) and chemical
industry (14%) and found to be represented in
industries such as such as trading (21%),media
and entertainment (20%)and services (19%)
PUBLIC SECTOR
GOVERNANCE
PUBLIC SECTOR
• In the public sector, governance is a combination of processes
that a board implements to manage and monitor the
organization's activities in achieving its objectives. Basically,
governance is the means by which goals are determined and
accomplished.
• This means that they help to, in some way, deliver goods and
services that cannot be, or should not be, provided by ‘for
profit’ businesses.
AGENCY IN PUBLIC SECTOR
• One of the key concepts in corporate governance in the private sector is agency.
• This means that the people who manage a business do not own it, and in fact manage
the business on behalf of their principals.
• It is said that management has an agency relationship with the principals in that they
have a fiduciary duty to help the principals achieve the outcomes that they (the
principals) seek.
• In a private or public incorporated business organisation, the principals are
shareholders and, in most cases, shareholders seek to maximise the long-term value
of their shares.
• This is usually achieved by profitable trading and having strategies in place to enable
the company to compete effectively in its competitive environment.
 THREE “Es” OF PUBLIC SECTOR GOVERNANCE
• A common way of understanding the general objectives of public sector
organisations is the three Es: economy, efficiency and effectiveness.

• ECONOMY:
• Economy represents value for money and delivering the required
service on budget, on time and within other resource constraints.
• It is common for public sector employees and their representatives to
complain about underfunding but they have to deliver value to the
taxpayers, as well as those working in them and those using the service.
EFFECTIVENESS:

• Effectiveness describes the extent to which the organisation

delivers what it is intended to deliver.
EFFICIENCY:

• Efficiency is concerned with getting an acceptable return on the money

and resources invested in a service.
• Efficiency is defined as work output divided by work input and it is all
about getting as much out as possible from the amount put into a system.
• It follows that an efficient organisation delivers more for a given level of
resource input than an inefficient one.
CHARACTERISTICS OF GOOD GOVERNANCE
CHARACERRISICS OF GOOD PUBLIC SECTOR GOVERNANCE

• Participation
• Rule of law
• Transparency
• Responsiveness
• Consensus oriented
• Equity and inclusiveness
• Effectiveness and efficiency
• Accountability
Relationships between the Principles for Good Governance in the Public
Sector
 GOOD GOVERNANCE IN PUBLIC SECTOR
• Good governance is at the heart of any successful business. It is essential
for a company or organisation to achieve its objectives and drive
improvement, as well as maintain legal and ethical standing in the eyes
of shareholders, regulators and the wider community. Governance is not
simply a concern for large companies, but for any business or
organisation of any shape or size.
• Governance is especially important in the public sector because you’re
dealing with the public’s money.
CORPORATE
GOVERNANCE &
CORPORATE
SOCIAL
RESPONSIBILITY
 WHAT IS CORPORATE GOVERNANCE ?

• Corporate governance is the system by which companies are directed and

controlled
• The responsibilities of the board include setting the company's strategic
aims, providing the leadership to put them into effect, supervising the
management of the business and reporting to shareholders on their
stewardship.
PARTIES OF CORPRATE GOVERNANCE
 ISSUES OF CORPORATE GOVERNANCE

• Getting the Board Right. ...

• Performance Evaluation of Directors. ...
• True Independence of Directors. ...
• Removal of Independent Directors. ...
• Accountability to Stakeholders. ...
• Executive Compensation. ...
• Founders' Control and Succession Planning. ...
• Risk Management.
 CORPORATE SOCIAL RESPONSIBILITY
• Corporate social responsibility (CSR) is a self-regulating business model that helps
a company be socially accountable—to itself, its stakeholders, and the public. By
practicing corporate social responsibility, also called corporate citizenship,
companies can be conscious of the kind of impact they are having on all aspects of
society, including economic, social, and environmental.

• To engage in CSR means that, in the ordinary course of business, a company is

operating in ways that enhance society and the environment, instead of contributing
negatively to them.
BENEFITS OF CSR
 Evolution of Corporate social responsibility
PHASE ONE :

The first phase of CSR was driven by the noble deeds of philanthropists and charity. It was influenced by family values, traditions,
culture and religion along with industrialization. Till 1850, the wealthy businessmen shared their riches with the society by either
setting up temples or religious institutions. In times of famines, they opened their granaries for the poor and hungry. The approach
towards CSR changed with the arrival of colonial rule in 1850. In the Pre-independence era, the pioneers or propagators of
industrialization also supported the concept of CSR. In the 1900s, the industrialist families like Tatas, Birlas, Modis, Godrej, Bajajs
and Singhanias promoted this concept by setting up charitable foundations, educational and healthcare institutions, and trusts for
community development. It may also be interesting to note that their efforts for social benefit were also driven by political motives.

PHASE TWO :
The second phase was the period of independence struggle when the industrialists were pressurized to show their dedication towards
the benefit of society. Mahatma Gandhi urged the powerful industrialists to share their wealth for the benefit of the underprivileged
section of the society. He gave the concept of trusteeship. This concept of trusteeship helped in the socio-economic growth of India.
Gandhi regarded the Indian companies and industries as “Temples of Modern India”. He influenced the industrialists and business
houses to build trust for colleges, research, and training institutes. These trusts also worked to enhance social reforms like rural
development, women empowerment and education.
PHASE THREE:
• In the third phase from 1960-1980, CSR was influenced by the emergence of Public sector undertakings to ensure the proper
distribution of wealth. The policy of industrial licensing, high taxes and restrictions on the private sector resulted in corporate
malpractices. This led to the enactment of legislation regarding corporate governance, labor, and environmental issues. Still, the
PSUs were not very successful. Therefore there was a natural shift of expectation from the public to the private sector and their
active involvement in the socio-economic growth. In 1965, the academicians, politicians, and businessmen set up a national
workshop on CSR, where great stress was laid on social accountability and transparency.

PHASE FOUR:
• In the fourth phase from 1980 onwards, Indian companies integrated CSR into a sustainable business strategy. With
globalization and economic liberalization in the 1990s, and partial withdrawal of controls and licensing systems there was a
boom in the economic growth of the country. This led to the increased momentum in industrial growth, making it possible for
the companies to contribute more towards social responsibility. What started as charity is now understood and accepted as a
responsibility.

• Corporate Social Responsibility was not recognized in the act of 1956 and it was not even mandatory for the corporation to
conduct activities beneficial for the society at large.
 
 EXAMPLES OF CSR
• Starbucks has long been known for its keen sense of corporate social responsibility and commitment
to sustainability and community welfare. According to the company, Starbucks has achieved many of its
CSR milestones since it opened its doors. According to its 2020 Global Social Impact Report, these
milestones include reaching 100% of ethically sourced coffee, creating a global network of farmers and
providing them 100 million trees by 2025, pioneering green building throughout its stores, contributing
millions of hours of community service, and creating a groundbreaking college program for its
employees.

• Starbucks' goals for 2021 and beyond include hiring 5,000 veterans and 10,000 refugees, reducing the
environmental impact of its cups, and engaging its employees in environmental leadership.

• The 2020 report also mentioned how Starbucks planned to help the world navigate the coronavirus
pandemic. The company's response to the pandemic focuses on three essential elements: prioritizing
the health of its customers and employees, supporting health and government officials in their attempts
to mitigate the effects of the pandemic, and showing up for communities through responsible and
positive actions.
 ELEMENTS OF EFFECTIVE GOVERNANCE

1. Leadership
2. Ethics & Integrity
3. Stewardship
4. Accountability & Transparency
5. Effectiveness
6. Roles and Responsibilities
7. Participation