Asian Journal of Research in Business Economics and Management
Year : 2015, Volume : 5, Issue : 8
First page : ( 28) Last page : ( 44)
Online ISSN : 2249-7307.
Article DOI : 10.5958/2249-7307.2015.00157.7

Corporate Governance Mechanisms for Financial Sanctity – A Review in the Indian Context

Mishra Mamta

Associate Professor, The Entrepreneurship School, Gurgaon, India

Online published on 6 August, 2015.

Abstract

The paper takes a look at the existing literature on corporate governance and traces the origin of corporate governance and drivers for its growth in recent times. It reviews some of the governance mechanisms and their adequacy in protecting shareholder interest. Corporate governance provides shareholders with a range of mechanisms to check managerial greed, opportunism and earnings manipulation. The paper reviews the mechanisms of audit committee and whistle blowing in particular and their applicability in the context of Indian companies. It also traces the evolution of corporate governance in India to the present day scenario with the introduction of the Companies Act, 2013. The Companies Act 2013, which calls for sweeping changes in corporate governance and auditing norms, has increased the scope of responsibilities for audit committees. It is expected that as companies scramble to comply with the provisions of the new Companies Act, the role of audit committees in public companies will acquire a new dimension. In the times to come, audit committees may emerge to be an indispensable mechanism in preventing managerial intervention in financial reporting and ensuring sanctity of the audit process.

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Keywords

India, corporate governance, audit committees, Companies Act 2013.

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