Corporate Governance

Corporate Governance

Introduction

The topic of research which I have chosen for my project is the approaches of corporate governance in multinational companies belonging to different sectors. Extensive reforms have taken place in this regard in different jurisdictions. This has led to differences in approaches that are followed by multinational companies. The aim of this research project is to measure and assess the effectiveness and the credibility of the corporate governance systems applied in different sectors.

Principle Argument

In the world of globalization and modernization, companies have to make sure that they handle the external and internal threats implied on them due to changing dramatic conditions. This concept is supported by Wooldridge and other researchers in 2001 who considered it the main challenge for the company to work as the center of excellences. This challenge is increased when companies operate in global economies. The managers have to weave their corporate practices in a global production network. The regulation of the company operations and activities can only be done in the best way if the different aspects of modern markets are taken into consideration. It is also important to consider the changes in the needs of the shareholders and stockholders. It is clear that there is a key difference in the methods and approach of corporate governance. These differences vary according to the social and cultural aspects and are aloes dependent on location attributes.

Supporting Arguments

The business operations and the systematic approach to corporate are of special interest to the government of the jurisdiction in which business is operating. The reason of this evaluation is the effective and satisfactory protection of the stakeholders and the general public. This factor has enhanced multi folded due to the financial losses that threat the viability of the company. These threats not only affect the company but also affect the local economy. The example of Enron is the well established one in this regard. The differences in corporate structure internationally have made it compulsory for the regulators and jurisdictions legislators to identify if the company has well adapted the legal principles in their business operations. The social and cultural characteristics of the company should also be aligned with the state regulation for this purpose; the evaluation of the company is done by considering its size and the state in which it is operating.

Criteria of the Project

The underlying aim of the project is to identify the practices of corporate governance that form the guidelines for multinational firms. For this purpose, the two multinational companies are chosen that operate in different industry and in different legislation. This project will also present and compare the elements of corporate governance that are applied to the relationships between the employer (board of directors) and employees. In this regard, the project will also strive to understand the role of major corporate governance systems of UK and USA in which the MNCs are based.

The first MNC that will be studied in this project is Tyco International Ltd. which has its headquarters in Princeton in New Jersey, United ...