Corporate Governance Systems and their Impact on Performance of Companies

Abstract

Lack of governance has always been an issue in Pakistan, restricting growth of its companies. The increased competition due to arrival of MNCs, well-equipped with best practices, emphasizes the need of good corporate governance systems according to socio-economic culture of Pakistan. A good corporate governance system helps accelerate the socio-economic growth of a country by maintaining a balance between rights of all stakeholders. The corporate governance models adopted by most of organizations in Pakistan and other developing nations include Anglo-US, German and Japanese models. The same are reviewed to evaluate their application in Pakistan. The study will help understand benefits and problems of mentioned corporate governance systems and also help design a system best for Pakistan ensuring balance of power and representation of all stakeholders that is one of the main reasons behind poor governance in Pakistan.