Importance of corporate governance in the banking sector.
The quality of governance plays a vital role in the economic development of countries as everybody knows that without good governance there can be no sustainable development in a country. It is widely recognized that good governance is a sine non qua for economic development of developing countries.People can judge whether those with governance are helpful by looking at the banking systems in place. A growth in the banking sector may suggest that there is more investment in businesses. This investment can be good for people as infrastructure improves when businesses grow.External governance needs to be maintained by the central bank. Internal governance needs to be maintained through effective internal control, by the banks themselves. If a bank does not maintain internal governance, the central bank can do nothing with outside monitoring. It’s a symbiotic relationship that depends heavily on good governance.
Corporate governance in the banking sector is not just a formality but a dire need of society. In almost every country in the world, there is a watchdog like RBI which monitors all the transactions and activities undertaken by the banks and regulate the business of the bank by making them submit regular reports related to the business undertaken by them.The Banking Sector and its Impact. 3831 words (15 pages) Essay in Business Law. has been a marked increase in disclosures and transparency in bank balance sheets as also greater focus on corporate governance.. financial sector reform was undertaken early in the reform cycle in India. Second, the banking sector reforms were not driven by.
What Is Good Corporate Governance Accounting Essay 2.1 Introduction. The practice of good corporate governance helps to differentiate one organisation from others. Corporate governance has been heavily researched in the past few years and at its most central point it refers to the governance of corporations.
