NEED FOR CORPORATE GOVERNANCE
Corporate governance is all about how a structure can be formed that would allow a considerable amount of freedom within the rule of law. The rapid pace of globalization in financial markets and the surge in the collapse of market giants through corporate scandals have been the major reason for its steady growth in the last two decades. In today’s changing business environment, it has emerged as a powerful tool of competitiveness and sustainability. This has forced professional law-making bodies to frame regulations for the implementation of the same. A company is not just about profits, market valuations, and turnovers. A lot goes into building a position and an image. Corporate governance is one such hidden tool. With such mechanisms in place, companies tend to function efficiently by ensuring compliance with statutory guidelines bracing themselves against any risk that bolsters the possibility of destruction of their political or economic events. By doing so, a company involuntarily tends to enhance its shareholder's value, including minority shareholders who are not adequately represented on the board A sound corporate governance framework is a contributor to attracting long term capital from investors, both domestic and international. It also gains the credibility of global market players. Adherence to such norms would also lead to reliable and regular disclosures which are critical to facilitate the decision-making process of investors concerning the stewardship of management, valuation, and other important aspects of the corporation. Moreover, since the economy today is globalized, the integration of India’s economy with that of the world demands that the Indian industries conform with the standard of international rules on corporate governance. Industry-leading companies have, in an unprecedented pattern faced allegations of corporate governance lapses. To name a few, Yes Bank, Sun Pharma, Indigo Airlines, Zee Entertainment, etc. In the year 2009, before the Corporate Governance Voluntary Guidelines issued by the Ministry of Corporate Affairs, a massive corporate disaster by Satyam permanently altered the landscape of corporate governance in India. The inadequacies and inherent shortcomings of the corporate regulatory framework were brought to the limelight by the fiasco. The cardinal lesson drawn from the entire episode was that good governance needs to emanate from the soul and not be imposed upon. This stems from the fact that despite voluminous provisions in the Companies Act, 1956, as well as the Income Tax Act, 1961, corporate scams, still abound and there was no dearth of defaulters.

This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, Or Religion Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being.