GS4 · 10 marks · 150 words

Critically assess the role of regulatory frameworks in enforcing ethical standards in corporate governance. How can these frameworks be designed to encourage ethical behaviour without stifling innovation?

Answered by 3 toppers · CSE 2024–2025

Corporate GovernanceAccountability and Ethical GovernanceCodes of Ethics and Conduct

Syllabus: Public/Civil service values and Ethics in Public administration: Status and problems; ethical concerns and dilemmas in government and private institutions; laws, rules, regulations and conscience as sources of ethical guidance; accountability and ethical governance; strengthening of ethical and moral values in governance; ethical issues in international relations and funding; corporate governance.

How toppers approached it

From all 3 answers · about 150 words.

Opening

  • No separate opening2 of 3
  • A definition1 of 3

Body

  • Points2 of 3
  • Points and prose1 of 3

Close

  • A summary2 of 3
  • No separate close1 of 3

The toppers’ answers

Raghav JhunjhunwalaAIR 4 · CSE 2025 · 170 wordsTheir whole copy

Opening

Today's corporate governance sees dualism: plethora of regulations but drought of ethical standards.

Regulatory frameworks Key Provisions (Companies Act, 2013) → Independent directors to represent small shareholders Key Provisions (Companies Act, 2013) → Strong Audit Practices Key Provisions (Companies Act, 2013) → Financial transparency

success in creating Ethical Standards → Tata Group (Paid for families affected by 26/11) success in creating Ethical Standards → IBM Corp. (mass spending at CSR → Files max patents also) success in creating Ethical Standards → Institutional framework has been provided

Challenges faced → unsafe for women, other vulnerable groups Challenges faced → Hazardous products (sole profit chasing) Challenges faced → Diversion, corruption Ex: Videocon, Yesbank

Body · points and prose

Better framing of Ethical/Regulatory frameworks

(i) constant upgrades Ex: today, need to put ESG standards.

(ii) Role fixing to improve accountability

(iii) not being too restrictive & rigid → Allow Flexibility

Close

Companies can follow regulations and innovate simultaneously. Ex: Google: 10x productivity challenge (sleep pods, free food & Entertainment) with strong focus on Regulatory standards.

More on Corporate Governance

Ethics in the private sector: boards and disclosure, corporate social responsibility, regulatory capture, business and society.

All GS4 questions on Corporate Governance