Corporate Governance around the World

Different countries follow varying corporate governance models, emphasizing the importance of either shareholders, as in the Anglo-American and Indian models, and multiple stakeholders as mandated in the Continental Europe and Japanese models.

Laws such as Sarbanes-Oxley in the US and the Turnbull Guidance in the UK set strict requirements for internal corporate governance controls in those countries. The Securities and Exchange Board of India or SEBI has established Clause 49 that provides corporate governance guidelines for all listed companies.

Sarbanes Oxley Act

The Sarbanes Oxley Act, made into law following major instances of corporate fraud and malfeasance in the United States in the early 2000s, includes regulatory requirements for corporate governance.

The Act mandates that companies institute internal procedures to ensure accurate financial disclosure.

Section 404 of SOX stipulates that “Publicly traded companies must establish, document, and maintain internal controls and procedures for financial reporting.” Section 404 also requires companies to check the effectiveness of internal controls and procedures for financial reporting.

To establish Section 404 compliance, companies must:

  • Document existing controls and procedures that relate to financial reporting
  • Test their effectiveness
  • Report on any gaps or poorly documented areas

To get a thorough understanding of how SOX regulates internal controls and promotes effective corporate governance, read more>>

Turnbull Guidance for Internal Controls, UK

The Turnbull Review Group released the Turnbull Guidance for listed companies in the UK, emphasizing the importance of regular and systematic assessment of the risks facing the business and the value of embedding risk management and internal control systems within the business processes.

The guidance states that it is the board's responsibility to make sure this happens. Taken together with the Operating and Financial Review, the internal control statement made in the annual report provides an opportunity for the board to help shareholders understand the risk and control issues facing the company, and to explain how the company maintains a framework of internal controls to address these issues and how the board has reviewed the effectiveness of that framework.

It is in this spirit that directors need to exercise their responsibility to review on a continuing basis their application of the revised guidance.

To get a better understanding of how to comply with the Turnbull Guidance, read more>>

Clause 49, Securities Exchange Board of India (SEBI)

Clause 49 instituted by SEBI has provided guidelines to improve corporate governance in the country. These guidelines cover the following issues:

  • Minimum number of Independent Directors on their boards
  • Institution of Audit, Shareholders’ Grievance Committees and so on
  • Annual reports to include Management’ Discussion and Analysis (MD&A) section and Corporate Governance report
  • Fees paid to non-executive directors to be disclosed
  • Limited the number of committees on which a director could serve
  • Boards to adopt formal codes of conduct
  • CEO/CFO to certify financial statements
  • Disclosures to shareholders to include more comprehensive information

The non-mandatory clauses include a whistleblower policy and restriction of terms of independent directors.

To get a better understanding of SEBI’s Clause 49, read more>>

ComplianceOnline training on Corporate Governance

Internal Control and Sarbanes-Oxley Section 404
The webinar provides an in-depth look at Section 404 and the COSO Guidance used by most organizations for compliance.

Converging Ethics, Governance, and Culture
This webinar will explore the importance for converging corporate ethics, governance, and culture as an essential safeguard to assure organizational performance is legal, ethical, and sustainable.

Foreign Corrupt Practices Act (FCPA) Webinar
In this Foreign Corrupt Practices Act (FCPA) webinar training understand the prohibited and exempted actions as per FCAP act, how to find the non compliance issues and how to implement FCPA compliance policies and procedures in your organization.

Preparing for the UK Bribery Act
This training on UK Bribery Act will help you understand its requirements and how it will impact your organization. Learn how to identify areas of risk, proactively mitigate them to avoid significant fines and loss of reputation.

The UN Convention Against Corruption and other international anti-corruption efforts
This webinar will discuss various international efforts to fight corruption and potential pitfalls that US businesses must be aware of when conducting overseas business.

Foreign Corrupt Practices Act - How Your Institution Can Comply
This webinar will discuss the FCPA and potential pitfalls that US businesses must be aware of when conducting overseas business.

Constructing an Effective “Whistleblower” System
This webinar will explore how you can enhance effectiveness of current Whistleblower systems in light of the new Dodd-Frank Act and the preceding Sarbanes-Oxley Act.

The SEC’s New Whistleblower Rules: Implications for your Company’s Compliance and Fraud Program
This webinar on SEC's revised Whistleblower Rules will outline key changes and focus on the effects these new rules will have on your organization's internal compliance and fraud investigations.

Internal Control and Sarbanes-Oxley Section 404
The webinar provides an in-depth look at Section 404 and the COSO Guidance used by most organizations for compliance.

The Fundamentals of (Corporate) Fraud
This webinar explores corporate fraud, fraud risk, and some of the common schemes, scams, and shams that threaten an organization's reputation and performance.

The Fundamentals of Internal Auditing
This webinar on Fundamentals of Internal Auditing training will discuss the differences between external and internal auditing and provide guidance on how to design and operate an effective internal auditing activity.

Governance, Risk & Compliance: Developing a holistic approach to governance
This presentation will review the current state of maturity models and prepare you with a roadmap for successfully enhancing your current process or building a strategic plan for GRC excellence.

Ethics in Your Organization
This webinar will examine trends and requirements for good corporate governance and social responsibility.

Auditing your Compliance and Ethics program
This Webinar will show you how to audit your compliance and ethics program by evaluating the design and operating effectiveness.