Implementation and Improvement of Good Governance in Organizations

This report explores the implementation and improvement of corporate governance within organizations. It begins with an acknowledgement and abstract, highlighting the importance of corporate governance for stakeholder relations and organizational performance. The report includes a detailed table of contents and is structured into several chapters, covering an introduction, literature review, research methodology, data analysis, and a conclusion with recommendations. The introduction establishes the significance of good governance, while the literature review provides context from existing research. The methodology outlines the research approach, data collection, and analysis methods, including illustrations and respondent responses. The report emphasizes the role of leadership, the board of directors, and committees in implementing and improving corporate governance. It addresses key issues such as ensuring compliance, strategy formulation, information provision, and the appointment of competent personnel. The conclusion summarizes the findings and offers recommendations for enhancing governance practices, including the importance of clear roles, performance measurement, and cultural change.

HOW TO IMPLEMENT AND IMPROVE GOOD
GOVERNANCE IN AN ORGANIZATION

ACKNOWLEDGEMENT
Dissertation is prepared on ways that can be adopted to implement and improve corporate
governance in the organization. During the time I was working on my dissertation there were lots
of problems and it is guidance of some people that help me in completing research work. First of
all, I am thankful to all my friends and relatives that give proper guidance to me in preparing
dissertation. It was there support which help me in completing my dissertation on time. Finally, I
intend to give thanks to teacher who support me in entire research work.

ABSTRACT
Corporate governance is one of the most important part of the organization. If, it will be
developed than firm will be able to develop good and reliable relations with stakeholders. In this
report multiple ways that can be adopted to implement above discussed thing in the organization
will be discussed. Along with this, steps that can be taken to improve same will be described in
detail. The role that leadership can play in implementation and improving governing body at the
workplace will be discussed in report. It is strong leadership that ensures that all activities are
performed by following rules and regulation in the organization. In order to improve governing
body there are some steps that can be taken by an organization. In this regard, in this report role
of administration committee in bringing changes in corporate governance will be discussed.
Apart from this management committee and importance of its autonomy in improving same will
be evaluated in the report. There are many other points that are related to improvements in
corporate governance. These points will be discussed in detail in different sections of the report.

TABLE OF CONTENTS
CHAPTER 1: INTRODUCTION....................................................................................................5
Aim & objectives....................................................................................................................5
Rationale of research..............................................................................................................6
Significance of study..............................................................................................................6
Research issue........................................................................................................................6
Structure of report ..................................................................................................................7
CHAPTER 2: LITERATURE REVIEW.........................................................................................8
CHAPTER 3: RESEARCH METHODOLOGY...........................................................................13
3.1 Research introduction or overview.................................................................................13
3.2 Research type..................................................................................................................13
3.3 Research design..............................................................................................................13
3.4 Research approach..........................................................................................................14
3.5 Research philosophy.......................................................................................................14
3.6 Data collection methods.................................................................................................15
3.7 Data analysis...................................................................................................................15
3.8 Validity and reliability....................................................................................................16
3.9 Ethical consideration......................................................................................................16
3.10 Limitation of study.......................................................................................................17
CHAPTER 4: RESEARCH METHODOLOGY...........................................................................18
CHAPTER 5: CONCLUSION AND RECOMENDATION.........................................................28
REFERENCES..............................................................................................................................31
APPENDIX....................................................................................................................................33
ILLUSTRATION INDEX
Illustration 1: Do you know about corporate governance..............................................................19
Illustration 2: People response on question whether policies can be implemented only by
preparing rules and regulations......................................................................................................19
Illustration 3: People response on use of infrastructure to implement CG in the systematic way 20
Illustration 4: Respondents response on effectiveness of management committee in evaluating
decisions of BOD and its role in proper implementation of rules and regulations........................21

Illustration 5: People response on appointment of effective chairperson for effective
implementation of administration system .....................................................................................22
Illustration 6: People response on impact of selection of right person as member of executive
committee on implementation of CG.............................................................................................23
Illustration 7: Role of CG committee in implementing determined procedures............................24
Illustration 8: Respondents response on development of risk management system by using which
stakeholders can be treated in systematic way...............................................................................25
Illustration 9: People opinion on improving relevant system by making available required
information to the stakeholders......................................................................................................26
Illustration 10: People comments on effectiveness of the clear differentiation of roles and
responsibility at different level of management in order to improve corporate governance.........27
Illustration 11: People response on contribution of change in culture in improving relevant
system ...........................................................................................................................................28

CHAPTER 1: INTRODUCTION
Governance is one of the buzzing words in today’s business world because most of the
firms irrespective of their size are focusing on developing their corporate governance. It is a set
of rules and regulations that are followed while dealing with different stakeholders. It is basically
used to maintain balance between interests of different stakeholders (Tricker and Tricker, 2015).
In order to implement corporate governance in better way, it is very important for the business
firm to make sure that who is there key stakeholders and to what extent they have importance in
the business (Galbreath, 2010). In order to deal with them in better way, rules and regulations
can be prepared, which will be followed in order to treat stakeholders in a better way. It is very
important for the firms to make sure that their administration given in proper way and helping it
in managing its operations that are related to different stakeholders. With passing of time, it is
important to bring changes in the control system and procedures because with improvement in
same, firm will be more capable to serve interest of its stakeholders in systematic way (Van den
Berghe, 2012). It is a well-known fact that good administration ensures economic growth of the
firm. If relevant system will be good, then firm will be able to treat its stakeholders in the best
way.
Mentioned entity is growth driver of the firm and if they will be satisfied, then business
firm will receive full cooperation from them and its growth rate will elevate at fast pace. Thus, it
is very important for the firm to improve its administration policies and procedures so that more
strong relationship can be built with stakeholders (Adachi, 2013). There are a number of steps
that can be taken to improve relevant system like ensuring that rules and regulations are followed
tightly (Krishnan, 2017). In other words, it can be said that many times in the firm governing
mechanism is developed, but it is not implemented strictly. In such a situation, managers must
make sure that rules and regulations are not only in book; they are also implemented at ground
level. The other improvements that needs to bring corporate governance is that role of Board of
Directors in strategy formulation must be confirmed (Haque. and Deegan, 2010). Similarly,
many other changes can bring governance for benefit of an organization.
There are number of steps that can be taken by the firms to improve corporate
governance by the business (Brickley and Zimmerman, 2010). Under corporate governance the
business firms prepare simple rules and regulation. There are people on the floor that are
responsible for implementation of corporate governance at the workplace. It is ensured that all

rules, regulations and policies that are prepared at the workplace will be implemented in proper
manner. There are number of steps that can be taken by the managers to improve corporate
governance at the workplace (Kolk and Pinkse, 2010). Under this first of all it must be ensured
that good governance cannot be bring in the firm just by complying with rules and regulations.
Employees needs to be responsible for their work. Role that board of Directors will play in
formulation of strategy must be clearly determined at the workplace so that scope of authority
and liability as well as responsibility of Board of Directors can be determined at the workplace
(Adjaoud and Ben‐Amar, 2010). Time to time performance of the business firm must be
measured and areas where performance need to be improved must be determined. In order to
ensure that corporate governance will be implemented effectively at workplace sufficient amount
of information must be provided to the Board of Directors (Khan, Muttakin and Siddiqui, 2013).
Further, steps must be taken to ensure that corporate governance structure must be improved. In
this regard, competent chairperson must be employed at the workplace. By doing so it can be
ensured that relevant person, will make necessary changes in corporate governance structure at
workplace. There must be a separate team that time to time evaluate Board members
performance. By doing so corporate governance can be improved at workplace.
Aim & objectives
Aim – The main aim of the research is to identify the ways in which corporate governance can be
improved and implemented in an organization.
Objectives – Following are the research objectives:
 To analyses improvements that must bring in corporate governance structure.
 To investigate the effective ways that can be adopted to implement administration system
in the firm.
 To explore relationship between corporate governance and improvement in organization
performance.
Research questions
What are the improvements that must bring in corporate governance structure?
What are the effective ways that can be adopted to implement administration system in the firm?
What is the relationship between corporate governance and improvement in organization
performance?

Rationale of research
It was important to conduct this research study, because corporate governance is an
integral part of an organization and plays an important role in its growth. When one tries to
identify reasons behind slow growth of an organization, then many thing's comes in mind but
often governance is not counted in such reasons. Hence, this is one the main reason due to which
it is assumed that research on selected topic is necessary to be carried out. By bringing good
changes in policies and procedures of organization performance can be improved to a great
extent. Hence, in this report, different ways are identified that can be adopted to improve firm
performance by evolving rules and regulations. Along with this, ways that can be followed to
implement same are also identified in the report.
Significance of study
There is lot of significance of this study and one of them is that this report will help
readers in understanding the importance of corporate governance. Research work will provide
information about the several ways that can be adopted by corporate in order to improve their
governance. Mere preparation of rules and regulations is not sufficient and due to this reason
information about ways that can be adopted for effective implementation of administration
related infrastructure is also provided in this report. It can be said that this study will analyze lot
of things and its results will be helpful to managers in their business decision-making.
Research issue
The main issue is that small-scale firms are not taking sufficient steps to improve their
corporate governance. It is an issue now because these firms’ managers, in meeting identify
number of factors due to which performance is poor. But, they do not consider above mentioned
element as a factor which is affecting their performance. This research will shed light on the
ways that can be adopted to improve governing body and steps that can be taken to implement it.
Structure of report Introduction – It is a part of the report in which research topic and issues related to same
are discussed briefly. Rationale of research and related issues are important part of this
section of the report as they provide information about the reasons due to which it is
necessary to conduct study on specific topic. This section gives an overview of entire
work that will be done on research.

 Literature review – In this section, various literature's are reviewed which aids in
identifying the thoughts that various scholars think in relation to research topic. This
creates broad understanding about the topic. Hence, this is also one of most important
part of present work. Research methodology – In this part of report, various tools and techniques that will be
used to conduct research will also be determined. Accordingly, data will be collected and
analyzed in research. Data analysis – On the basis of research methodology section, specific method will be
adopted to analyze data and to arrive at specific result. On the basis of results of this
section of study, conclusion and recommendation section will be prepared. Discussion – In this section of the report, detailed discussion will be carried out on the
results of analyzed data, which will help in arriving at specific conclusion.
 Conclusion and recommendation – This is last section of the report and in this
conclusion will be prepared on the basis of discussion section. Finally, at end of the
report, recommendation will be prepared on the basis of conclusion.

CHAPTER 2: LITERATURE REVIEW
In every organization whether it is a large scale or medium sized, there are some rules
and regulations that govern entire internal process which is related to decision-making and
managing business operations. According to Adjaoud and Ben, (2010), corporate governance
provides overall direction in which all leaders and managers needs to work. In an organization,
authority and responsibility mechanism is established since its commencement year. All
employees have to work under set limits in an organization. If there will be vague policies in the
firm, then activities will overlap between different designations which can create confusion
among the employees. Clear rules and procedures help managers in smoothly running the
business operations, which benefits enterprise. When an organization starts its operations it must
carry out detail work on determining roles and responsibilities in respect of job. In case this will
do fundamentals of corporate governance will be more strong. From inception year business
internal and external operations will be performed smoothly which lead to improvement in
market efficiency level.
As per views of Minnick and Noga, (2010) corporate governance aids white-collar
workers in performing their management functions in effective way. Control is one of important
element of functions of the management. In large size company, different entities are present like
Board of Directors and CEO or Chief executive officer under a structure. In mentioned type of
business firms, board always evaluates decisions taken by the CEO. If former entities have any
objection, then it communicates the same to the latter entity and demand clarification from CEO.
This model of governance ensures that organization will take care of interest of its stakeholders.
It can be said that it is very important to develop corporate governance in proper way when an
organization is established by entrepreneur. By doing so firm can maintain good relationship
with shareholders and suppliers as well as financial institutions. Thus, it is very important to
maintain good administration system in an organization. It can be seen that when new leader
come and old one exit, matter of discussion comes in existence among stakeholders specially
when firm size is large. This situation arises because stakeholders are concerned about the way
and approach that new leadership will follow to treat them. Every leader mentality is different
from other in respect to ways that can be adopted to tackle a situation. Hence, due to change in
situation with advent of new leadership stakeholders som times receive a different treatment in
comparison to same that they received in earlier time period.

Contrary to this Claessens and Yurtoglu, (2013), state that there are many firms wherein
there is a culture that Board members can ask questions from CEO but such kind of practices
was failed many times many times. This is because CEO and Board of Directors works together
and have friendly relations and due to this reason, they does not go opposite to each other. Due to
this reason, corporate governance in the firm become weak. Thus, it is not necessary that if
there Board of Directors have right to ask question to CEO then corporate governance can be
made better.
As per views of Johnstone, Li and Rupley (2011), executive committees that are prepared
in an organization must have right type of people in terms of experience and skills. This is
because related members look after day-to-day management activities. If there will not be right
type of employees in the executive committee, then it will be impossible to deliver effective
leadership to the former entity. Mere preparation and implementation of rules and regulations
under corporate governance is not sufficient; it is also very important for managers to give
effective leadership to the employees. If there will be effective leadership, then rules will be
implemented effectively at ground level. Hence, in order to improve above mentioned system, an
organization must lay down special emphasis of recruitment of right person as member of
executive committee. In this regard top managers of the firm can laid down some parameters
and same can be followed for recruiting a right candidate for the Executive committee. It is
possible that single person can select wrong candidate as member of the mentioned committee.
In order to prevent occurrence of above discussed scenario two stage interview process can be
followed in every firm. In respect to this on first stage top manager can take interview of an
individual for the post that is vacant in executive committee. In second stage of interview CEO
or owner of the firm can take interview in order to ensure that candidate that is refereed to them
is eligible for the post that is vacant in executive committee.
Opposite to this Bruno and Claessens, (2010) state that term effective leadership must be
clearly defined in the organization. Effective leadership does not mean that an individual is
giving very tough direction to its employees. Such kind of leadership may prove effective and
ineffective both for the firm. This is because some times such practice will prove beneficial in
terms of implementation of corporate governance. But some times manager by showing adamant
behavior prevent employees from following rules and regulations tightly. Thus, corporate

governance does not implement in proper manner. Due to this reason, it is necessary to define
term effective leadership at workplace.
According to Gillan, Hartzell and Starks (2011), corporate governance is a set of rules,
procedures and practices by using which firm operations are controlled and employees are
directed in the specific way. Risk management is one of the important domains in which top
managers and executive committee works consistently. Business conditions are uncertain and
due to this reason firm is exposed from various types of risks in its business. Executive
committee members prepare strategies to handle various types of risks that are faced by concern
in its internal as well as external operations. By making changes in policies and procedures,
appropriate system can be prepared to oversight risk. In this regard, number of steps can be taken
by the top managers. They can prepare a rule that at the end of every month board meeting will
be organized under which discussion will be carried out on changes that are coming in the
business environment. Similar type of meetings can be conducted by executive committee. This
change in corporate governance will ensure that each and every change that comes in the
business environment within one month is identified. By preparing strategy in new way, firm
will deal with its stakeholders according to change in situation. This will help firm in managing
good relationships with the stakeholders by keeping in mind changes that are observed in the
business environment.
Frésard and Salva (2010), claims that good corporate governance bring transparency in
the firm. This is because under these rules are prepared in respect to the flow of information.
More will be flow of information; top management will be able to make wise business decisions.
If provision is prepared in respect to availability of information to stakeholders and to managers,
then there will be effective management and good relationship with the stakeholders. In this
regard, rules can be bring in an organization under which it will be liability of the accountants to
prepare financial statements in such a way that provide sufficient information about the firm.
Firm by altering its rules and regulations can make it mandatory for relevant employees to follow
international reporting standards strictly. In order to implement this change in the firm
modification can be done in the guidelines that are followed to prepare annual report. In annual
report information can be provided in respect to the threat that were faced by the firm in
business. Along with this, strategies that were formulated to counter threat and capitalize
opportunities can also be provided in mentioned type of report. Along with this notes can be