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The purpose of this study is the development of an integrated framework between corporate governance and sustainability, based on the advancements within the field of contemporary governance leading to a renewed focus on sustainable development.

In this paper, the authors provide succinct summary of the evolution of corporate governance over the past century from an historical perspective: starting with the early work of Berle and Means – which focuses on the legal separation of ownership and control – and the subsequent challenges within this framework – all the way to analyzing the major impact of Nobel Laureate Milton Freidman’s work on corporate goals and governance. The authors' approach identifies the key transformation of corporate goals and corporate goals' paradigm shift in progression and focus within corporate houses over time, including how these are approached in the present day by integrating the concept of primacy of all stakeholders. The authors relate this to contemporary developments in the Business Round table and the United Nations’ adoption of the 2030 Agenda for Sustainable Development Goals. The authors also identify specific corporate governance themes within global economic forums, as well as the critical interlinkages needed by all global corporations to achieve sustainable growth.

The primary objectives of the corporate governance themes adopted by global economic forums this decade are in the best interest of all stakeholders – including customers, employees, regulators, local communities, and shareholders. This applies both during periods of relative stability and during crises. A review of the good corporate governance relies on internal mechanisms such as the structure of a board and incentives for management, and on external mechanisms such as institutions that demand accountability. All these mechanisms are important as the mechanisms form the core of how (and for whom) corporations generate value. Ultimately, optimal corporate governance can help deliver both economic gains and societies that value all.

With globalization, the public has higher expectations from corporate CEOs than in the past. Corporate leaders have the ultimate responsibility for creating an organizational culture that supports trust and ensures that corporate leaders' management and employees embody and act on the stated values and mission of their organization. Areas of increased social expectations that require the attention of boards of directors include diversity, transparency, equal opportunity, and eliminating all forms of harassment.

This study identifies a viable agenda for global corporations based on concurrent developments to achieve sustainable development and growth. The recent related research work is also presented.

The paper presents an overview of perspectives on corporate governance grounded in the Common Law legal traditions of the UK and the USA. It further discusses whether that perspective is suitable for global application.

The paper presents personal observations on the operational dynamics of rules and practices of corporate governance as necessary functional supports for large scale financial capitalization of enterprise under conditions of modern industrialization.

The paper concludes that the US perspective on corporate governance is rationally related to objective requirements of financing enterprise and that, as capital markets become larger and more liquid around the world, the corporate governance regimes will, in the main, come to resemble the US model. Though cultural variations on the US pattern are compatible with the purposes of corporate governance to constrain abuse of power in private corporations.

The implication of this paper is for the implementation of corporate governance regimes in emerging market countries, i.e. that flexibility is permissible but a focus on transparency and accountability under all circumstances is required.

The contribution of the paper is to provide a framework for balancing the rules and practices of US corporate governance with the cultural styles and patterns of different national regulatory settings.

This chapter examines corporate governance–related financial reporting issues in the context of globalization. Over the past few decades, the process of globalization has substantially altered the fields of corporate governance and accounting. More specifically, Anglo-American models of corporate governance and financial reporting have received increasing momentum in emerging economies, including China. However, a review of relevant studies suggests that there is limited research examining the implementation of Anglo-American concepts in various countries regardless of their growing acceptance. This monograph extends the existing literature by comprehensively investigating the adoption of internationally acceptable principles and standards in China, the largest transitional economy that has different institutional context from Anglo-American countries. In addition, the review has a number of implications for developing the theoretical framework, and determining the research methodology for the monograph.

The governance of capital market institutions did not receive much interest compared to their banking sector counterparts, partly due to their different ownership structures. Recent trends; increased competition, technological advances, structural changes, globalization, all had their share of impact on governance systems of capital markets institutions particularly on exchanges. Corporate governance of non-financial firms and capital markets institutions differ in several ways. Firstly the role of risk management differs since they may impose systemic risks to the financial system. Secondly well-implemented governance structures and processes are required but are not sufficient in capital markets since there are several conflicts of interests to be addressed. Therefore whether and how effectively they function is what matters. Thirdly the governance structures of such institutions exhibit different effectiveness on their decisions.The governance of FIs in capital markets is discussed in terms of board structure and management, risk governance, supervisors, shareholders, executive compensation, role of regulators, authorities and values and culture. The role of stock exchanges in corporate governance are discussed separately in terms of implementing corporate governance codes, demutualisation and its impact on regulations, transparency and accountability issues and the effects of M&As among exchanges. Market needs strong analytical tools and reliable benchmarks to assess governance risk. The corporate control and the regulation of the institutions by the exchanges when the corporations (regulated) are the competitors of the exchanges (regulators) or owned by the stockholders of the exchanges must be addressed. The risk of regulatory arbitrage, calls for the need of harmonisation among regulators. Better regulation of FIs and greater global coordination among regulators are seen as the most two important issues to prevent another crisis.

The study of Bharat Heavy Electricals Limited (BHEL)11BHEL was founded in 1950s. It has emerged as the largest engineering and manufacturing enterprise of its kind in India. Power equipment major BHEL has approached the government for the grant of coveted Maharatna status, which will give the company greater financial autonomy. At present, BHEL is a Navratna company. A company qualifying for the Maharatna status should have an average annual turnover of more than Rs 20,000 crores in the last three years, according to the new guidelines. Once a company gets the Maharatna status, its board would not be required to take the government’s permission for investments up to Rs 5,000 crores in a joint venture project or wholly owned subsidiary. For the Navratna companies, the limit is Rs 1,000 crores. was undertaken to understand the quality of corporate governance in public sector and to gain insight into the major infirmities in internal and external conditions that impinge on the quality of corporate governance in the public enterprises. In India, to bring in more transparency and accountability in the functioning of Central Public Sector Enterprises (CPSEs), the government of India in June 2007 introduced the Guidelines on Corporate Governance. These Guidelines were originally of voluntary nature. The government has acknowledged the need for continuing the adoption of good Corporate Governance Guidelines for ensuring robust public sector with high level of transparency and decided to make these Guidelines mandatory and applicable to all CPSEs. Thereby, government in March 2010 asked all the 246 CPSEs to mandatorily follow corporate governance norms and business ethics, a step to ensure more transparency in their functioning.

This chapter analyses how corporate governance codes in Europe approach CSR, devoting specific guidelines or recommendations or specifying the responsibility of implementing and disclosing CSR in the company.

Content analysis have been used in a sample of 27 corporate governance codes of 27 European countries, issued in the European Union (EU) and United Kingdom (UK), issued by governments (seven codes), national stock exchange (eight codes), industrial associations (six codes) and composites (six codes).

Only five out of 27 codes make and explicit reference to the term Corporate Social Responsibility (CSR). Two of them reflect the importance of a CSR Report (Slovenia and Spain), whereas the Spanish Code was the only code which devoted a section to the implementation of a CSR policy.

Although corporate governance codes could represent an opportunity to shift the focus from an implicit CSR approach to an explicit CSR approach in Europe, the truth is that content related to the issue and its level of specificity does not reflect that change yet.

Previous literature has not focused on the analysis of corporate governance codes from a CSR perspective, so the chapter is relevant for policy makers when it comes to updating corporate governance codes.

The intensity of carbon emissions has led to the serious problem of global warming, and the consequences in terms of climatic disasters are gaining increasing attention worldwide. As the energy sector is responsible for most global emissions, developing clean energy is crucial to combat climate change. This study aims to examine the relationship between corporate governance and renewable energy (RE) consumption and explore the interaction between RE production and RE use.

The study adopts an econometric framework of a panel model, followed by the robustness check using alternative methods, including logit regressions. The bivariate probit model is used to analyze the interaction between the decision to use and the decision to produce RE. The analysis is based on a sample of 3,896 firms covering 45 countries worldwide.

The results reveal that appropriate governance mechanisms positively impact RE consumption. These include the existence of a sustainability committee; environmental, social and governance-based compensation policy; financial performance-based compensation; sustainability external audit; transparency; board gender diversity; and board independence. Firms with appropriate governance mechanisms are more likely to produce and use RE than others. Finally, while RE use positively impacts firm value and environmental performance, the authors find no significant effect on current profitability.

This study goes beyond previous research by exploring the impact of multiple governance mechanisms. To the best of the authors’ knowledge, this is also the first study examining the relationship between RE use and firm value. Overall, the findings suggest that RE transition requires, first of all, establishing appropriate governance mechanisms within companies.

Corporate governance has become a core topic in management research and business practice. Recent debates like – environmental responsibility, sustainability, ethics, corporate control, generation, protection and distribution of wealth, the role of the board and senior executives in setting standards for performance management, and stakeholder relationship management – have strong links to organisational trust. However, management literature has been relatively silent on how various corporate governance configurations and perspectives potentially shape trust relations within the organisation, especially in Africa. Thus, this chapter reviews corporate governance through the lens of the institutional logics perspective evident in western capitalism and develops a framework connecting various governance configurations to organisational trust. Doing so provides new directions for those seeking to develop further research in corporate governance, institutional logics and organisational trust.

Purpose – As corporations and capital markets become more global, it is increasingly important to understand the differences in corporate governance practices.

Approach – This chapter provides a framework for the implementation of corporate governance that can be used globally for study and adaptation. It also describes three corporate governance systems (Anglo-American, Communitarian, and Emerging Markets) and provides an analysis and comparison of how the framework for corporate governance is applied differently, and how success should be evaluated differently, in these three systems. Lastly, it considers the possibility of convergence toward a global system of corporate governance.

Practical implications – There is significant heterogeneity in corporate governance worldwide but there are universal aspects, such as roles, responsibilities, inputs, and processes, which result in effective corporate governance. Understanding the similarities and differences enables researchers and managers to work with multiple systems in different countries where corporations and stakeholders have varying objectives, structures, and internal and external determinants.

Value of chapter – This chapter presents a comparison of the three systems that is critical for further study of global practices. Additionally, the internal and external determinants that impact the varying corporate governance systems are analyzed to more carefully consider the performance measures that account for differences in objectives, motivations, and performance.