ABSTRACT
Corporate governance is a process, relation, and mechanism setup for the corporations and firms based on certain guidelines and principles by which a company is controlled and directed. The Organization for Economic Cooperation and Development published its Principles of corporate governance giving a very comprehensive definition of corporate governance a set of relationships between a company’s management, its board, its shareholders and other stakeholders. The intensity of family ownership in India is comparable to that found throughout Asia, the Middle East, Italy, and Spain. In Indian business environment a related-party transaction can present a potential or actual conflict of interest by advancing the self-interests of families holding a majority stake to the detriment of minority shareholders. Indian companies need only obtain board approval for related-party transactions, even large ones, not broader shareholder approval. In Indian society, respect for elders is paramount; it is customary to demonstrate deference to their views.
