February 21, 2024

Corporate relations and decision making procedures

This article has been written by Ms. Shubhangi Kusum, a 4th year student of ICFAI University, Jharkhand.

ABSTRACT

This article analyses the place of corporate relations in the system of civil law as well as the procedures to establish and confront the relations of the corporate. There is a need for proper establishment of relationships in the corporate for the purpose of long-term stability and functioning of all kinds of high performance. The decision-making procedures are also one of the main important aspects which should be considered as an integral part of the administration in the corporate field. Corporate relations with the help of their teams can cultivate the relationships not only for a shorter period of time but also for a longer period. This article is an precise and accurate example of the issues and problems, followed by the procedures and lastly the conclusion of the mentioned topic.

 

INTRODUCTION

The corporate relations and the decision-making procedures are the two main aspects of corporate governance and how the company can be operated and how it can interact with its stakeholders. It can be said that it governs and regulates the connections, communications and interactions with the company with its various stakeholders, such as customers, it can be partners of the company as well, media for the communication, the investors of the company and the most importantly for the public. The basic aim of the relationship is to create a positive image and adequate reputation for the company as well as for the promotion of its products, services as well as values and goals of the company. Corporate relations involve various activities and strategies related to communications, branding and advertisement as well as corporate social responsibility and corporate governance. The corporate decision-making procedures are the steps and the methods that a company uses to make the choices and solve the problems.  There are various factors and aspects for which decision making can varies which depends upon the level of the decision, the type of the issue on which the decision is to be taken as well as the complexity of the decision and lastly the organizational culture and structure. Here are some common elements of the decision-making procedures of the company, they are by establishing objectives, generating the alternatives, evaluating criterions and conditions, selecting the best option and implementing the decisions and lastly monitoring the results are the main perspective of the decision-making procedures of any organizations. There are various needs for the proper and sustainable decision-making procedures for not only considering the specific period for the company but also identifying the future goals and of the company. The decision-making procedures and the relation in between the corporate are the two sides of the same coin depending on each other. The decision-making procedures can also impact the relations of the corporate as both can have a sense of similar co-ordination with respect to the situations.

 

Corporate relations – Definitions and its Objectives

A good relationship basically helps in developing the status as well as the reach of a corporate in various terms such as a good relationship can establishes a good communication, a good interaction and a better understanding in between the companies and their other related entities. Corporate relations in the context of the law refer to the interactions and dynamics between corporations, their stakeholders and legal frameworks. Corporate relations can also be said to maintain goodwill with others and create a trustworthy environment to reach the peak of the work to establish the set of examples and objectives to others as well. Let us understand the objectives and importance of the corporate relationship with some of the points discussed below:

  • Corporate relationship establishes better governance as corporate governance encompasses the rules, set of practices and processes by which the companies are directed and controlled. If there will be better relationship between the corporations, then there should be an ease of working as well as in the governance of the other works related to the growth of corporations. It also ensures the transparency of works, accountability, and ethical behaviors within an organization.

 

  • In India, the corporate governance is governed by the various regulations, including the clause 49 of the Securities and Exchange board of India (SEBI). This clause discusses the provisions related to independent directors, disclosures and transparency in corporate affairs which can help corporate in establishing a better set of understandings and the relationship between them. 

 

  • It also safeguards the interest of the investor as well as the transparency in the corporate affairs. As we know, companies are required to provide regular disclosures, which include quarterly reports and annual corporate governance sections, to shareholders. These are the basic principles which reports aim to safeguard the investor and their good faith and enhance the transparency and maintain it. The disclosure of works in a suitable interval of time creates a sudden trust and goodwill for the corporation as it ensures the clarity of working and a mutual understanding between the corporates.

 

  • Related party transactions (RPTs) mainly occur when a company engages in financial transactions with its related parties. These transactions with its related parties refer to the transaction such as directors, key managerial personnel, or their relatives. It plays a very crucial role in establishing the values and good faith in the corporations as related party transactions must be disclosed transparently to prevent and precut conflicts of interest and ensure fairness. The companies Act 2013, mandates disclosure of Related party transactions in the annual report, along with compliance certificates from auditors or company secretaries. 
  •    There are various other objectives of the corporate relations which are discussed below:

 

  • Information nowadays plays a very important role in maintaining transparency and corporate communication. It mainly aims to inform various stakeholders, including employees, investors, customers and the public. By providing accurate and time-précised information, the shared information provides assurance and mutual understanding for the transparency of works, also enhances the trust building capabilities in between the parties.

 

  • There are various corporations which use communication strategies to influence the opinions as well as the behaviors of the another which helps in the growth of similar consent for the work and culture. If we consider the promotion of a new product as well as advocating for a cause, enhancing and shaping public perceptions, effective and efficient communication drives persuasion. It persuades the changes occur in the opinions, behaviors and decisions of the corporations.

 

  • Corporations strive to establish better and positive relationships with employees, customers, suppliers, and with other communities to maintain goodwill of their own which helps a corporation with a better reputation in the market. The consistency of these behaviors leads a corporation towards a trusted, credible as well as an authentic reputed corporation. Trust, credibility and goodwill are nurtured through consistent and authentic communication.

 

  • Corporate communication ensures that everyone within the organization understands the ethos, values, and objectives of the corporation with the nature of creating and administering a healthy and positive environment. 

 

  • The employees should need clarity on the company goals, policies and their roles.

 

  •  Effective and efficient communication aligns everyone toward a common purpose.  External reputation also plays a vital role. Companies communicate their achievements, social responsibility efforts, and commitment to ethical practices. A positive external reputation attracts investors, customers and partners.

 

  •  During the crisis, corporate communication plays a critical role.  Swift, transparent communication helps companies navigate challenging situations. 

 

Decision-Making Procedures

 

The decision-making procedure of a corporate is multifaceted and occurs at various levels within the organizations. There are various things which affect a decision-making procedure within a corporation. For the better understanding we can classify these procedures in various ways which are as discussed below: –

 

  • Top to down vs. Bottom-up decision making: – 

This is a type of decision-making that takes place at higher levels of the organizational hierarchy. Decisions are formulated by mostly senior management and then cascade down the corporate ladder of implementation. The top-level management deals with the decisions which are on the higher level of the hierarchy, and which are regulated by the top-level management. It can be the people such as directors, management of the boards or the other members of the board of directors.     

                On the other hand, there is bottom-up decision-making procedures which mainly empowers the middle managers as well as the line managers to make decisions based on the conditions and circumstances of their team specified by the help of an ideal survey and opinion or by analyzing the situation. These decisions pertain to day-to-day operations. 

 

  • Middle management’s role: – 

The middle managers basically find themselves in a challenging position acting as a “burger” layer which means that they are the intermediary between the upper layer and the lower layer of the corporation. They are the ones who implement the decision made by the higher-ups while also making operational choices for their teams. The commitment of the middle management is critical for successful implementation. Organizations often hold off-site meetings to give a brief about the circumstances of the top-level decisions and their impact.

 

Let us consider some benefits of the decision-making procedures of a corporation which are as follows: – 

 

It Saves Time and Money:

  • A well-informed decision helps to streamline the processes, helps in reducing unnecessary delays and inefficiencies.
  • It also empowers in avoiding indecision or poor choices for the corporations and save valuable time and other financial resources.

It Boosts Productivity:

  • When a management excels at the decision-making, it leads to better outcomes. It is well-known that a better decision will surely generate a better outcome.
  • Good decisions enhance team morale, it also helps in improving the focus and concentration of the team as well as the overall productivity.

It Betters the Use of Resources:

It helps in conducting Efficient Costing:

 

It improves Identifying the Right Opportunities:

It Helps Establishing Achievable Goals:

Remember, decision-making in business differs from problem-solving. While problem-solving is reactive, decision-making is proactive, considering long-term effects and organizational context. The accuracy, objectivity, and consistency achieved through well-structured decision-making processes contribute significantly to an organization’s success.

In summary, effective decision-making is the compass guiding organizations toward growth, adaptability, and sustainable success.

 

Conclusion 

The above-mentioned points conclude about the role of the relations between the corporations which has a great impact on the upliftment of wellness and selecting the services for the customers of their own. The article concludes the points related to behavioral, corporate-ethics, good working culture and a healthy understanding between the parties of the corporation. These are the key features for a corporation to establish better communication between themselves and better communication will help in the emergence of good mutual consent and understandings. There are various aspects which are required in developing good communication such as corporate relations and the transparency between them. Transparency of works, Disclosure and non-disclosure of works etc. are the key things for the development of corporation. Another important thing is to maintain secrecy, which also helps in establishing a better mutual understanding. The decision-making procedures also play a very vital role in the development of a corporation in various ways such as establishing achievable goals, set of principles and other ethics and values. It can be said that these are the two sides of the same coin.

 

Reference 

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