Project Report on "Corporate Governance and Financial Reporting Quality in Bangladeshi MNCs: A Pathway towards Transparency and Accountability”

Abstract

The subject of this paper focuses on the extent to which corporate governance affects the Financial Reporting Quality FRQ and the level of transparency for Bangladeshi MNCs. Looking into governance frameworks, the study goes further deeper exploring structured functionalist strategies of ethical accountability, transparency to assist in portraying competitive sustainable business internationalism. The data collection techniques used in the research are structured questionnaires both primary and secondary data that is analyzed descriptively, comparatively and by regression analysis. The survey includes 25 top MNCs of telecoms, pharmaceutical and financial service industries in Bangladesh. Specific aspects of governance captured include; board of directors’ independence, audit committee, CEO/Board duality and IFRS. The evidence for the study supports the presumption that sound structures of governance improve the financial performance and reliability of this report. When board of directors are diverse and independent, the economic returns show 15% of asset returns of those firms (ROA), proving the positive impact of sound governance to its operational returns. The absence of how audit committees operate independently underscores the need for having more independent members of the committees, particularly board members: the ratio of firms having more than 60% independent audit committee members had 20 percent fewer cases of financial statement fraud. Also, a distinction between the CEO and chair of the board was adopted to improve transparency by reducing power concentration and conflict of interest by 10%. The further enhancement of IFRS standards and the effective internal controls raised confidence and financial stability of the stakeholders. In improving the standards of governance, the study proposes prestigious independent board committees in operational domains, increased independence of the audit committees and clear demarcation of responsibilities between the CEO and the Chairman of the board. The other recommendations are training with practical evocations of governance practices and the use of AI-based compliance solutions to increase precision and confidence. While prior research is scarce, this report fills some of these gaps by incorporating sustainability into Bangladeshi MNC governance topics and stressing transparency, accountability, or ethical standards for these corporations. This work benefits academics, practitioners, and policymakers by providing practical recommendations and a new theoretical perspective on how to raise Bangladeshi MNCs to international standards of governance. The recommendation and the findings included here are aimed to improve image, competitiveness, and performance of the Bangladeshi corporations at the global level.