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What do you understand by ‘moral integrity’ and ‘professional efficiency’ in the context of corporate governance in India? Illustrate with suitable examples.
corporate governance is a system by which companies are directed and controlled by set of rules and regulations, processes and procedures; “Moral integrity” and “Professional efficiency” cardinal principles that guide the behavior of individuals and companies. Moral Integrity in context of corporateRead more
· Transparency: Timely and accurate disclosure of information (e.g., Wipro in annual report).
· Power Distribution: Avoid concentration of power in few hands (e.g., Kingfisher airlines).
· Independent Directors: Ensures unbiased decision-making (e.g., IL&FS case).
· Curbing Insider Trading: Prevents misuse of confidential information (e.g. SEBI action against Future Group).
· Financial Accuracy: Prevents accounting fraud (e.g., Infosys appointing independent auditor).
· Fairness: Acting ethically even in difficult situations (e.g. companies retaining employees during COVID).
· Corporate Social Responsibility: Genuine CSR initiatives (e.g., ITC’s livelihood generation programs).
· Code of Conduct: Clearly defined and communicated guidelines (e.g., Wipro’s whistle-blowing policy).
Professional Efficiency
· Strategic Leadership: Adapting strategies to changing needs (e.g., Infosys’s global positioning).
· Timely Decisions: Efficient decision-making processes (e.g., Vodafone-Idea merger).
· Meritocracy: Appointing based on skills and qualifications (e.g., TATA group).
· Objective Evaluation: Fair and impartial judgment (e.g., ICICI Bank’s risk management).
· Clear Regulations: Well-defined roles for regulatory bodies (e.g., avoiding confusion like in Saradha scam).
· Resource Management: Effective utilization of resources (e.g., for achieving goals).
· Stakeholder Engagement: Active communication with stakeholders (e.g., SBI during financial crisis).
Innovation: Implementing solutions for growth (e.g., Nandan Nilekani’s UIDAI project).