LAHORE: The Lahore Chamber of Commerce & Industry (LCCI) has urged both the government and private sectors to focus on good governance that is a must for economic revival of the country.
In a statement issued here Monday, the LCCI President Sheikh Muhammad Arshad and Vice President Nasir Saeed said that good governance is inevitable for both government and business community but businesses particularly need to strive for implementation of sound corporate governance practices to improve performance individually and boost investors’ confidence in a bid to improve the economy that has been facing multiple internal and external challenges. They said corporate governance is also essential in ensuring transparency, strong and balanced economic development as well as in minimizing wastages.
They said that Good Corporate Governance has emerged as a set of dynamic principles inevitable for developing an evil-free environment both vertically and horizontally for business proliferation.
The LCCI office-bearers said that corporate governance leads to a good flow of capital as well as minimizes corruption, risks and mismanagement besides lowering capital costs. It is imperative in a growing economy like ours to boost investors’ confidence and good corporate governance leads to greater confidence.
“The companies that have good corporate governance structures always perform better than those that have weak governance structures. Every organization should have structures that ensure safe growth and business failures were largely due to poor corporate governance structures”, they added.
The LCCI office-bearers stressed the need for some modification in global corporate governance model saying that it could not be same for all countries as ground realities and economic conditions are different in different countries.
Elaborating the point, they said that Pakistan has its own culture and traditions therefore family influence over business in this part of the land matters more than any country of the world.
The LCCI office-bearers said that like any developing economy, Pakistan also houses a large number of SMEs which not only employee major segment of workforce but also contribute to a great deal in GDP. Most of these SMEs are family owned enterprises and for that matter keeping in view the typical style of management adopted by Pakistani businessmen, the importance of learning about new concepts get manifold.
They said that it is really significant to understand that the economy grows if SMEs grow. It is therefore vital that all stakeholders of the economy like government, banks, industry, business promotion bodies to collaborate with each other to ensure the growth and sustainability of SMEs.
They said an ultimate objective of good corporate governance is to ensure an efficient management to safeguard the resources and minimize the risks for shareholders.
The LCCI office-bearers said that Good Governance flourishes necessarily in a corruption-fee environment. On the other hand, poor governance is the most encouraging and breeding source of corruption and it disrupts the society’s ideological characteristics. By establishing good governance practices, institutions are able to reduce conflicts, motivate employees to perform at higher levels and strengthen accountability mechanism thus stimulating the country’s economic growth and ability to achieve profitability.
