Looking at and Beyond Corporate Governance in India : A Journey of Three Decades of Reforms

This book explores theoretical and empirical perspectives on corporate governance and sustainability and reflects upon India’s three decades of corporate governance reforms. It provides a solid base of information culled from extensive empirical research. It will contribute to the 2030 agenda of the United Nations on Sustainable Development Goals by lighting the way forward and enhancing the convergence of corporate governance with sustainability in business entities. Adopting a credible and uniform sustainability reporting framework and cultivating a pervasive “sustainability culture” through effective “sustainability leadership” has become a business imperative. It will be highly relevant for all stakeholders, including shareholders, boards of directors, managers, academicians, and researchers, and it will empower, enrich, and enable them to gain more conceptual clarity and empirical understanding of corporate governance and sustainability issues. In addition,it shows the pathway for policymakers and practitioners to address the myriad challenges that emanate from sustainability by suggesting new approaches emerging in the critical domain of corporate governance. Foreword Preface Acknowledgements Contents Abbreviations List of Figures List of Tables Part I Looking at Corporate Governance 1 Corporate Governance—A Theoretical Perspective 1.1 Introduction 1.2 Evolution of the Corporate Form of Entity 1.3 Theories of Corporate Governance 1.4 Models and Practices of Corporate Governance in Selected Countries Anglo Saxon Model Japanese Model German Model Family-Based Model 1.5 Conclusions References 2 Corporate Governance in India: An Evolving Landscape 2.1 Introduction 2.2 Historical Perspective 2.3 Chronology of Three Decades of Reforms The First Decade of CG Reforms (1991–2000) The Second Decade of CG Reforms (2001–2010) The Third Decade of CG Reforms (2011–Till Date) 2.4 Conclusion References 3 Corporate Governance and Economic Performance—A Micro to Macro Perspective 3.1 Introduction 3.2 Channels of Corporate Governance Interplay Between Corporate Governance and Country Governance 3.3 Corporate Governance and Firm Performance—The Micro Perspective Data and Variables Empirical Model and Estimation Results and Discussion 3.4 Corporate Governance and Economic Growth—The Macro Perspective Hypothesis Development Data and Variables Period of Study Empirical Model and Estimation Results and Discussion 3.5 Conclusions and Policy Recommendation References 4 Linkage Between Corporate Governance, Foreign Direct Investment and Economic Growth—Empirical Evidence from India 4.1 Introduction 4.2 Review of Literature Linkage Between FDI and EG Linkage Between FDI and CG Linkage Between FDI, EG and CG 4.3 Hypotheses, Analysis and Discussion Data and Variables Period of Study Technique and Model Formulation 4.4 Conclusions and Policy Implications References Part II Looking beyond Corporate Governance – Corporate Sustainability and Sustainability Reporting 5 Rising Importance of Corporate Sustainability in the Current Era 5.1 Introduction 5.2 Application of SAP-LAP Framework to Explain Linkages Between CS and CG Situation Actor Process Learning Action Performance 5.3 Conclusions References 6 Embedding Sustainability into Businesses: Creating Sustainability Culture 6.1 Introduction 6.2 Sustainability Reporting 6.3 Sustainability Reporting Frameworks: A Brief Overview 6.4 Global Trends in Sustainability Reporting Sustainability Reporting in India 6.5 Aspects Involved in Preparation of the Sustainability Report 6.6 Challenges in Sustainability Reporting Overcoming Challenges Overcoming Challenges: The Indian Context 6.7 Impact of Corporate Governance on Sustainability Reporting: Indian Experience Data and Variables Empirical Model Identifying the Risk of Dynamic Endogeneity Empirical Estimation and Results Discussion Conclusions and Policy Recommendations References 7 Strengthening the Convergence of Corporate Governance and Sustainability—The Way Forward 7.1 Introduction 7.2 Convergence—Meaning 7.3 Drivers of Convergence of Corporate Governance and Sustainability Setting a Tone of Sustainability at the Top Sustainability Leadership Enabling Framework for Promoting Sustainability Leadership Top Management Orientation Setting Environment Targets and Linking with Planetary Thresholds A Strong Commitment to Responsible Business Conduct (RBC) Aligning Corporate Sustainability Strategies with the Government’s Action Plan/Commitments 7.4 Impediments for the Convergence of Corporate Governance and Sustainability Lack of Harmonisation of Sustainability Reporting Standards Inadequate Investment Horizon of Corporate Owners Lack of Sustainability Risk Anticipation Presence of Distinct Corporate Governance Systems Limited Emphasis on Green Finance Lack of Diversity, Equity and Inclusion (DEI) Approach Inadequate Mechanisms and Frameworks for Fixing Business Accountability 7.5 The Way Forward 7.6 Conclusions References Index