Page 46 - Banking Finance April 2023

ARTICLE

concept of "accountability and responsibility." This principle
holds that the board of directors and senior management
of a company are accountable for the company's
performance and for ensuring that the company is run in
an ethical and responsible manner. Accountability and
responsibility are intended to ensure that companies are run
in the best interests of all stakeholders, not just shareholders.

SWOT Analysis of Corporate Governance
in India
A SWOT analysis is a tool that can be used to evaluate the
current state of corporate governance in India. The
following is a SWOT analysis of corporate governance in
India: company. The composition of boards of companies in India
is not always diverse, with a majority of independent
directors being men and from similar backgrounds, leading
Strengths:
to a lack of representation and inclusivity.
One of the key strengths of corporate governance in India
is the government's commitment to improving corporate
Opportunities:
governance practices. The government has introduced a
number of initiatives to promote good corporate There are also a number of opportunities for improving
governance, including amendments in the Companies Act, corporate governance in India. As the Indian economy
2013, issuance of guidelines by the SEBI (Listing Obligations continues to grow, there is potential for further government
and Disclosure Requirements) Regulations, 2015 and the initiatives to improve corporate governance. The growing
National Voluntary Guidelines on Social, Environmental and global reach of Indian companies creates opportunities for
Economic Responsibilities of Business along with the greater adherence to international standards of corporate
establishment of the National Committee on Corporate governance. This can lead to increased trust and confidence
Governance (NCCG) and the Securities and Exchange Board in the Indian corporate sector, which can attract more
of India (SEBI). Additionally, there is increasing awareness foreign investment and boost economic growth.
among companies and investors about the importance of
good corporate governance practices. The increasing awareness and focus on sustainability, social
responsibility and environmental concerns can provide an
opportunity for Indian companies to adopt sustainable
Weaknesses:
practices and gain a competitive edge. The use of
There is a lack of consistency in the application of corporate
technology in corporate governance can provide new
governance principles in India, with some companies
opportunities for increased transparency, accountability and
adhering to best practices and others not. This can lead to
efficiency in the corporate sector.
a lack of trust in the corporate sector and can negatively
impact the country's economic growth. Further there is a
Threats:
lack of transparency and disclosure in some areas of
corporate governance in India, with some companies not One of the main threats is the lack of a strong legal
providing accurate and timely information about their framework for corporate governance. Additionally, there is
financial performance and operations. a potential for corruption and unethical behavior in
companies. The lack of enforcement of corporate
This can lead to a lack of trust from shareholders and governance laws and regulations in India can lead to
investors, and can lead to negative consequences for the companies not adhering to best practices and can negatively

40 | 2023 | APRIL | BANKING FINANCE