Você está na página 1de 3

Corporate Governance: A Remedy for Underdevelopment

Author: Leonardo Correia

Few topics are more central to the international business and development
agendas than corporate governance. A series of events over the last two decades have
placed corporate governance issues as a top concern for both the international business
community and the international financial institutions.1
The apex of bad governance might be identified on the recent global financial
crisis. After all, much of the damage in which this episode resulted was due to the
banker’s lack of conformity to corporate governance principles. If fairness,
accountability, responsibility and transparency were present at this process this would
by itself have prevented the banks from operating carelessly
An organization s system of governance need to be designed and operated so as
to facilitate the building and maintenance of trust.2 Corporate governance is one key
element in improving economic efficiency and growth as well as enhancing investor
confidence. Corporate governance involves a set of relationships between a company’s
management, its board, its shareholders and other stakeholders. It consubstantiates
practices that should be adopted by the private sector in order to foster development
(See for example, the OECD Governance Principles)
Although corporate governance help us understand what needs to be done to
guarantee ethics in the company and, in a general matter, the functioning of the market
economy, the broader concept of democratic governance will highlight the importance
of the linkages between civil society, market and government in fighting the corruption
and fostering the entrepreneurship process.
Strong democratic governance is a function of institutions that enable broad-
based participation of various civil society groups in public life. The need for sound
economic policies is essential for development and requires engaging broader civil
society and private sector in the democratic governance process. Successful market-

1
Instituting Corporate Governance In Developing, Emerging And Transitional Economies - A Handbook.
Center For International Private Enterprise. Available at:
http://www.cipe.org/publications/papers/pdf/IP0804.pdf
2
-The Institute of Social and Ethical AccountAbility, the UK,
www.accountability.org.uk
oriented reforms depend on giving citizens an opportunity to participate in
policymaking.3
Building market economies, unleashing entrepreneurship, strengthening
governance, promoting investment, securing property rights, and combating corruption
are some of the reform priorities that have been identified as key to reducing poverty
and moving countries up the development ladder. The UN’s own “Unleashing
Entrepreneurship” report and the Monterrey Consensus are just two of the many
initiatives.4
On the same note, it is possible to, based on the literature about governance,
present an interesting strategy for democratic governance reform to takes place. First,
one should assess the challenges to be faced in terms of fostering democratic
governance – fighting corruption and building entrepreneurship environment, for
instance.
Second, it is necessary to build awareness throughout different sectors – business
leaders, policymakers, society – and create, therefore, a broader public demand for reform.
Collective action is indispensable in combating corruption. When corruption is curbed
and governance improves, development dividend is significant.
After building awareness it is necessary to act against firms and people who
engage in bribery.In this sense, one can note that transparency deters corruption: The
World Bank publishes the names of corporations and individuals involved in corrupt
practices in World Bank-funded projects. International organizations such as
Transparency International can serve as a depository of information on corruption.
Greater transparency increases reputational cost and decreases incentives for corruption
However the importance of the governance concept, there has been little
progress globally on broader governance reforms – media freedom is lacking in many
countries; disclosure of assets by politicians is not widespread; political campaign
finance remains an issue.
The impact of many of the smaller initiatives, such as anti-corruption, manuals,
publications, and voluntary codes of conduct, may be rather limited. This perception
leads one to think about more efficient ways of dealing with the problem. Incentives for

3
Understanding Democratic Governance and Market Economy. Avaliable at:
http://developmentinstitute.org/topics/understanding/
4
From Sustainable Companies to Sustainable Economies: Corporate Governance as a
Transformational Development Tool. CIPE Issue Paper No. 0804
corruption can be reduced by third-party monitoring with serious sanctions for non-
compliance and high reputational costs. Nonetheless, there are often many vested
interests stacked against the implementation of anti-corruption reform.
The capture of the state institutions, laws, regulations, and policies of the
government by private elites is quite prejudicial to a country’s development, once micro
anti-corruption initiatives make little diference. State capture undermines
competitiveness of medium and small enterprises, as well as public sector governance.
Therefore, without good governance, the entrepreneurship process is also ruined.
That said, one start perceiving that well succeeded governance reform serves as
a condition for an efficient market economy to develop. After all, within an
environment within which corruption rules and within it is practically impossible to
create an enterprise, due to high transactional costs, market economy will serve only
vested interests.

Você também pode gostar