LAHORE - In US and EU over 85 per cent businesses are family run and are quite successful only because of implementation of true corporate governance that is a key to growth and helps minimise wastages as it leads to a good flow of capital minimises 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.

This was the upshot of speeches and presentations made at one-day training workshop on Corporate Governance jointly organised by the Lahore Chamber of Commerce and Industry and International Finance Corporation (IFC) here at LCCI on Thursday. LCCI President Farooq Iftikhar, former LCCI President Tariq Hameed, Mohsin Ali from IFC, LCCI Executive Committee Member Shoaib Zahid Malik and Convener LCCI Standing Committee on Corporate Governance Altaf Hussain Turabi.

The speakers shared their experiences with the audience regarding benefits of corporate governance and family owned businesses. They said that the companies that have good corporate governance structures always perform better than those that have weak governance structures. Every organisation should have structures that ensure safe growth as business failures were largely due to poor corporate governance structures.

The LCCI President Farooq Iftikhar said that corporate governance is an increasingly important area of focus for stakeholders in all organisations and particularly those listed on publicly traded exchanges. Today, all the organizations operating either at large or medium scales are facing ever greater challenges in addressing risk management, business ethics, strategic plans and internal controls.

He said that compliance with applicable laws and regulations while establishing effective management systems in line with international standards require serious commitment on the part of entrepreneurs and proper guidelines to be provided by institutions like LCCI and IFC.

Due to the ever changing societal norms, increasingly complex business environment and the recent corporate collapse of companies around the globe, Corporate Governance has emerged as an imperative issue at the forefront of organizational concerns.

Good corporate governance, for being a key driver of business performance, is not just an essential but a necessity for economic revival of the country and a major tool when it comes to attracting foreign investors.

There was a consensus among the speakers that the businesses need 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.

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. He said that the International Finance Corporation should prepare case studies for proper implementation of Corporate Governance in Pakistan.

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.