Dr.

Gaur Hari Singhania Institute of Management and Research

Business Environment

Assigned By:-
Prof. Anmol Chopra

Submitted By:-
Vishal Yadav
What is corporate governance?
Corporate governance is the set of guidelines, procedures, and practises that a business
employs to oversee and manage its activities, resources, and relationships with different
stakeholders. This involves how diverse parties, including shareholders, management, the
board of directors, staff members, clients, vendors, and the general public, are assigned rights
and obligations.

The basic objective of corporate governance is to make sure that the business is run
responsibly, openly, and with care for the interests of all stakeholders. This entails defining
duties and responsibilities, establishing clear lines of power and accountability, making sure
that moral and legal requirements are being followed, and encouraging openness and
disclosure.

Effective corporate governance is crucial for a company's long-term success and sustainability
because it fosters confidence and trust among customers, employees, investors, and the
general public. Also, it helps to reduce risks and potential conflicts of interest, enhance
decision-making and performance, and advance morality and civic responsibility.

Rules and regulations of corporate governance-

Corporate governance rules and regulations vary by country and by industry, and they are
constantly evolving in response to changing economic, social, and political conditions.
Here are some of the key developments in corporate governance over the years:

 1930s-1960s: The focus was on disclosure and transparency, with the introduction of
Securities Acts in the US and other countries to regulate the securities markets and
protect investors.
 1970s-1980s: The focus shifted to accountability and control, with the introduction of
the Sarbanes-Oxley Act in the US following a series of high-profile accounting scandals.
 1990s-2000s: The focus expanded to include social responsibility and sustainability, with
the introduction of the United Nations Global Compact and the development of
corporate social responsibility (CSR) reporting standards.
 2010s-2020s: The focus continued to be on sustainability and stakeholder engagement,
with the introduction of the United Nations Sustainable Development Goals and the
development of integrated reporting frameworks.
In addition to these general patterns, several specific rules and regulations have been
implemented in various nations and industries. For instance, the UK adopted the Corporate
Governance Code in 1992, and it has since undergone numerous revisions to reflect evolving
best practices and standards. With the Securities and Exchange Commission (SEC) and other
organizations, the US has also implemented a number of laws and regulations, notably the
Dodd-Frank Act, which added new rules for executive remuneration and financial reporting.
The Shareholder Rights Directive and the Non-Financial Reporting Directive are two examples
of the several corporate governance rules and regulations that have been implemented by the
European Union.

Companies Act 2013-

The Companies Act, 2013 is a comprehensive piece of legislation that governs the formation,
operation, management, and dissolution of companies in India. It was enacted by the Indian
Parliament to replace the Companies Act, 1956 and came into effect on April 1, 2014.

The Companies Act, 2013 aims to improve transparency, accountability, and corporate
responsibility in India's corporate sector. It has been updated several times since its enactment
to reflect changing economic, social, and political conditions.

SEBI in Business Strategies-

SEBI (Securities and Exchange Board of India) is the regulatory body that governs the securities
markets in India. It was established in 1988 with the mandate to protect the interests of
investors, promote fair and transparent securities markets, and regulate the securities
industry.

SEBI plays a crucial role in shaping business strategies in India by enforcing various rules and
regulations that impact how companies raise capital, issue securities, and operate in the
securities markets. Some of the key areas where SEBI's rules and regulations influence
business strategies include:

1. Capital Markets: SEBI regulates the primary and secondary capital markets in India,
which are the channels through which companies raise capital from investors. Its rules
and regulations impact how companies structure their securities offerings, set their
pricing, and comply with disclosure requirements.
2. Investor Protection: SEBI's rules and regulations are designed to protect the interests of
investors by ensuring that they receive accurate and timely information about the
companies in which they invest. This impacts how companies communicate with
investors, disclose financial information, and manage risks.
 3. Corporate Governance: SEBI has introduced various regulations related to corporate
governance, such as the Listing Obligations and Disclosure Requirements (LODR)
Regulations, which impact how companies are structured, how their boards are
composed, and how they interact with shareholders.
4. Merger and Acquisition (M&A) Activities: SEBI's rules and regulations impact how
companies engage in M&A activities, including the approval process for mergers and
acquisitions, the disclosure requirements for M&A transactions, and the regulations
related to hostile takeovers.

SEBI's regulatory framework shapes the business strategies of companies operating in India by
setting standards for transparency, accountability, and fairness in the securities markets.
Companies that comply with SEBI's regulations are more likely to attract investors and succeed
in the long run.

FORD
Ford Motor Company is an American multinational automaker that was founded by Henry
Ford in 1903. Ford is one of the largest automobile manufacturers in the world and produces a
wide range of cars, trucks, SUVs, and commercial vehicles.

Some of the popular Ford cars include:

1. Ford Mustang: This iconic sports car has been in production since 1964 and is known for
its distinctive design and powerful performance.
2. Ford F-150: This full-size pickup truck is one of the best-selling vehicles in the US and is
known for its durability, capability, and versatility.
3. Ford Explorer: This mid-size SUV has been in production since 1990 and is known for its
spacious and comfortable interior, as well as its rugged off-road capability.
4. Ford Escape: This compact SUV is a popular choice for families and commuters due to its
fuel efficiency, safety features, and versatile cargo space.
5. Ford Fusion: This mid-size sedan is known for its sleek design, comfortable interior, and
advanced safety features.
In addition to its traditional gasoline-powered vehicles, Ford is also investing heavily in electric
and hybrid vehicles. Some of its popular electric and hybrid models include the Ford Mustang
Mach-E, the Ford F-150 Lightning electric pickup truck, and the Ford Escape Hybrid.

Ford has a long history of producing reliable and high-quality vehicles that are designed to
meet the needs of a wide range of customers. The company is committed to sustainability and
is actively working to reduce its environmental impact through the development of electric
and hybrid vehicles, as well as the implementation of sustainable manufacturing practices.

Why Ford Shut Down In India-

Ford Motor Company announced in September 2021 that it would cease manufacturing
vehicles in India and would wind down its operations in the country. The decision to shut
down its operations in India was based on several factors, including:

1. Low Sales and Market Share: Ford struggled to gain a significant foothold in the highly
competitive Indian market, with sales of its vehicles lagging behind those of its
competitors. According to industry reports, Ford's market share in India was less than
2%.
2. High Costs: Ford faced high production and labor costs in India, which made it difficult
for the company to compete effectively with local and international manufacturers.
3. Restructuring Efforts: Ford has been undergoing a global restructuring effort aimed at
improving profitability and shifting its focus towards electric and autonomous vehicles.
The decision to shut down its operations in India is part of this broader restructuring
effort.
4. Economic Challenges: The COVID-19 pandemic and the resulting economic slowdown in
India also impacted Ford's decision to exit the market.

In light of these factors, Ford made the difficult decision to shut down its operations in India
and to focus on more profitable and sustainable business opportunities. However, the
company will continue to provide after-sales support and service to its existing customers in
India.