Effective Governance in the Era of Disruptive Changes in Business Illustrated by the Tata Capital Framework: The Vital Role of the Audit Commitee and Internal Audit

Identifying, assessing, managing, and containing risks is a fundamental responsibility of business and ‘business as usual’ in 2015. The question is: How can businesses be effectively governed in an era of disruptive changes while managing risks of business? This article explores – through the case example of Tata Capital, part of the Indian, global conglomerate Tata Group – how to effectively govern in an environment of disruptive forces impacting business while managing risk seen from an audit committee and internal audit perspective. Effective governance through regular evaluation of internal financial controls and risk management ensures that the systems of risk management are robust and defensible. This agenda should be integrated into the audit committee oversight and cannot merely reflect a check the box exercise. Instead, as illustrated by the Tata Capital Framework, it must reflect the core values and lead to sound actions in the entire organization that helps protect the brand value and maintain trust among all Tata Capital's stakeholders.