Indian Companies Adapting Best Global Practices
Date: Monday , January 03, 2011
Indian companies are keen in adapting best global practices and are increasingly doing so, says an expert, though he warns that these companies need to have regular evaluation at all levels to sustain good corporate governance. “Corporate governance has evolved enormously in India and many big companies in the country are committed to embrace global best practices for their business,” said Stephen Wagner, Chairman Emeritus of global consultancy Deloitte’s Global Centre for Corporate Governance.
“Good governance at companies usually translates into good financial numbers while just having good names on the (firms’) board need not ensure the same,” he said. It was the `14,000 crore accounting fraud of Satyam by its founder-chairman Ramalinga Raju that brought the issue of corporate governance into sharp focus in India. Wagner pointed out that regulations, especially those associated to corporate governance, should be framed after taking into account the view points of all market participants. He also suggested that there should be an annual evaluation process in place to assess the effectiveness of the board as well as the corporate governance in companies.
“Entities should anticipate and be more prepared to tackle risks and shocks, mainly since the world is getting more interconnected that is also resulting in connectivity of shocks,” Wagner said while talking about the change in taking and managing risk by the companies in the recent years.