Need of Corporate Governance in Banking Sector

-

Abstract

The corporate world in India could not ignore the changes in the United Kingdom, which had ahuge impact on our nation and eventually prompted us to establish our own ground rules on the notion ofCorporate Governance. After the 1990s, when economic liberalization and deregulation of industry andbusiness became a popular policy element in India, the notion of Corporate Governance becamewidespread. Corporate governance is essential not just for establishing credibility and trust, but also forensuring survival, consolidation, and expansion. To fulfil the following important goals, banks mustguarantee effective Corporate GovernanceFor Excellence Banks can no longer survive or flourish without Corporate Governance. It has become anecessary criterion for their continued market presence. No public sector bank could launch their firstpublic offering unless they met the Corporate Governance requirements.Through technological advancements and changes in the operating environment, the client has becomethe focal point for more tailored services and increased comfort for better customer relationshipmanagement.Under the auspices of Corporate Governance, banks have established a solid board of directors whofollow strong management and chevalier procedures. Decision-making procedures have also grownmore scientific as a result of a feeling of accountability and social responsibility.Corporate governance has allowed banks to increase their profitability and wealth production capability.Banks have expanded their commercial offerings to include insurance, banking services, and a widerange of diverse retail items. In September 1999, the Basel Committee produced a study on CorporateGovernance for Banking Organizations. The committee believes that banking supervisors areresponsible for ensuring effective Corporate Governance in the banking industry.