Fundamentals of Corporate Governance

SESSION 1
BY
SAHAR KHAN
Definitions and Concepts

Chapter 1
 Concept Building
• Adjust
• Jelled
• Organize
• Manage
• Control
• Lead
 Concept Building
• You Adjust Because you have to Compromise
• You Jelled Because you have to become Accepted
• You Organize Because you have to Manage
• You Manage Because you have to Lead
• You Control Because you have to Dictate
• You Lead Because you have to do all activities at one time
 Concept Building

• You Adjust Because you have to Compromise – Entry Level

• You Jelled Because you have to become Accepted - Officer
• You Organize Because you have to Manage - Executive
• You Manage Because you have to Lead - Manager
• You Control Because you have to Dictate – Senior Manager
• You Manage Because you have to do all activities at one time –
Director Level
• What You Manage?
Time , Work, Yourself
What You Control?
• Results after Implementation
Something that is autonomous ( Human, Reaction etc)
What You Govern????
 Bases of an Organization
• Purpose
• Functions Process
• Clientele
• Area or Place
 Bases of an Organization
• Purpose
Vision and Mission,
• Functions Process
• SOP’S
Marketing, Management , Accounts, Finance, HRM, Operation
• Area or Place
Virtual or Physical
How Would You Deal With That???
The Answer is Governance
Importance of Corporate Governance
 Importance of Corporate Governance -
Marketing
• Vigorous Competition
• Brand Proliferation
• Increasing Demand of Customer
• Everything is Fair in Business….
• Same goes for Marketing….
 Importance of Corporate Governance –
Management
• Management Functions
• Managerial Roles
• Management Styles
 Importance of Corporate Governance
– Accounts

• New Technological Advancement

• Current Position
• Future Forecast
• Losses are carry forward
• Tax Saving Techniques
 Importance of Corporate Governance –
Finance
• How to Control Investment
• How to Generate Funds
• Financial Ratios and Techniques
• Fix Assets and Variable Assets
 Importance of Corporate Governance – HRM
• History
• Reality
• Human behavior Conditional or Unconditional
• How to Control Human Mind
 Importance of Corporate Governance –
Operation and Supply Chain

• New Procedure
• Future belong to Supply Chain
• The process that control , monitor and ensure
effectiveness of all other procedures
 Definitions
• Corporate Governance is the system by which companies are
directed and controlled…”
• “Involves a set or relationships between a company’s management,
its board, its shareholders, and other stakeholders. Corporate
governance also provides the structure through which the
objectives of the company are set, and the means of attaining
those objectives and monitoring performance are determined.”
•  A shareholder owns part of a company through stock ownership,
• while a stakeholder A stakeholder is a party that has an interest
in a company and can either affect or be affected by the
business. The primary stakeholders in a typical corporation are
its investors, employees, customers, and suppliers.
 Definitions
• Good corporate governance consists of a system of structuring,
operating and controlling a company in order to achieve following
objectives:
• Fulfill long-term strategic goals of owners, which after survival may include
building shareholder value, dominant market share etc
• To consider and care for the interest of the employees present and future
(planning future needs, recruitments, training, working environment,
severance ( separation) and retirement procedure.
• To take account of the environment and the local community
• To maintain excellent relationships with customers and suppliers
• To comply with all legal and regulatory requirements
 Definitions
• In its broadest sense,
“Corporate governance is concerned with holding the balance
between economic and social goals and between individual and
communal goals”.
• The governance framework is there to ‘encourage the efficient use of
resources and equally to require accountability for the stewardship
(supervising or taking care of something) of those resources’. The
aim is to align as nearly as possible the interests of individuals, of
corporations, and of society.
Process of Corporate Governance

• The process of corporate governance comprises of

four main principal activities:

Direction Formulating the strategic direction for the future

Executive Action Level of involvement in crucial executive decisions

Supervision Monitoring and oversight of management performance

Accountability Recognizing responsibilities

THANK
YOU