Good corporate governance is imperative not only for commercial success but also for earning public trust and confidence that are important in a commercial and democratic environment, a prominent thinker and politician has said.
Dr Rajen Prasad, who has held several positions in the Government (Race Relations Conciliator and Chief Families Commissioner; currently Member of Parliament on Labour List), which envisage accountability, transparency and public trust, said that success of any venture depends on the governance systems and the competence of people delivering them.
“Corporate governance arrangements for an enterprise, whether in the public, private or in the voluntary sector, is the system of rules and processes that regulate how the organisation will deliver its services, create and promote its products.
“It is critical that these rules apply equally to matters that are determined internally and those that are external to the organisation,” he said.
High Expectations
Dr Prasad said that a number of external factors including societal expectations, laws, rules, regulations and workers’ interest in the enterprise should also be taken into account.
He said that good governance, embellished by integrity, transparency and accountability spell productivity for all profit and not-for-profit organisations.
“Undertakings that are unable to maintain a consistent record may survive only on their product monopoly, location or for being part of the state apparatus.
“Corporate governance systems are most effective when those responsible understand and respect internal and external demands and value ethical behaviour and standards. Effective corporate governance goes beyond focusing on the so-called ‘bottom line.’
“A singular focus on the “bottom line” without regard for ethical behaviour usually threatens the long term viability and profitability of many organisations,” Dr Prasad said.
Our Lecture
His comments are in consonance with the aims and objectives of the Indian Newslink Sir Anand Satyanand Lecture scheduled to be held on Monday, July 30, 2012 from 630 pm at Stamford Plaza Hotel in Auckland City.
Wellington based BusinessNZ Chief Executive Phil O’Reilly will be the Guest Speaker and would address the audience on, “Good governance-who wins: the shareholder, the public or Gordon Gekko?”
Gordon Gekko is a fictional hero of Wall Street and appears in Forbes magazine and some Hollywood movies.
Eminent Barrister Brian Stephenson will be the Master of Ceremonies.
Mr O’Reilly and Mr Stephenson are well known for their erudition, a firm grip on current affairs, the importance of governance in corporate and individual lives.
Dr Prasad said that commercial organisations and corporate executives, who are keen on adding value to their undertakings should subscribe to concepts and practices of good governance.
“The examples of corporate failures and scandals are now highly publicised and often they represent the failures, not of the market. They are of poor governance that failed to focus on internal and external factors as well as the responsibilities of good corporate citizens.
“State organisations are not exempt even if their failures are the result of poor policies and unreasonable expectations,” he said.
Dr Prasad believes that a carefully designed and articulated corporate governance system that is competently delivered secures the interests of those who invest in an organisation as well as those on whom the organisation relies to leverage their investments.
“Such a system would be elegant and yet simple,” he said.
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