Part- IV Managerialism and Corporate Governance
Managerialism
The word management is a complex one. It is considered as a function, a process, a group, a discipline and so on. All institutions require management and in all of them, management is the effective and the active organ. Managerialism is the effective can the active organ. Managerialism is the belief that organisations have more similarities that differences, and thus the performance of all organisations can be optimised by the application of generic management skills and theory. It is the belief in or reliance on the use of professional managers in administering or planning activity. In short the experience and skills pertinent to an organisation’s core business are considered secondary but the generic skills of management are considered primary. This gains importance because of separation of ownership and management in corporate entities.
Corporate Governance
Corporate Governance means the way in which corporate bodies are governed or managed. Business ethics or ethical practices of the professionals and the corporate social responsibility, accountability to stakeholders, transparency and full disclosure are required for better governance. All these considerations within which a company is managed in order to increase the value of shareholders and protect the interest of stakeholders are called corporate Governance.
Corporate Governance is defined by Milton Friedmen as, “the conduct of business in accordance with shareholder’s desire, which generally is to make as much money as possible, while confirming to the basic rules of the society embodies in law and local customs”.
Managerialism, with corporate governance confines to not only efficient corporate management, but it include a fair, professional and transparent administration and strive to meet certain well defined, written objectives, irrespective of the type of organisation, its objectives, scale of operation or the nature of stake holders.
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