Enhancing Governance, Risk Management, and Compliance (GRC) Practices: An Analytical Exploration

Abstract

The Indian banking sector plays a pivotal role in economic growth and financial stability, yet it faces persistent challenges such as governance lapses, rising non-performing assets (NPAs), and systemic risks. This study examines the effectiveness of corporate governance in mitigating these risks by analyzing stakeholder perceptions and empirical data. Findings indicate a high level of awareness of corporate governance among stakeholders, with no significant gender differences. A positive correlation exists between recognizing governance lapses and assessing governance quality, highlighting areas for improvement in implementation. Additionally, confidence in banks’ risk management capabilities strongly aligns with the belief that sound corporate governance positively influences financial performance. Despite the presence of regulatory frameworks, governance challenges persist, necessitating an integrated approach that fosters transparency, accountability, and ethical conduct within banking institutions. The adoption of advanced technologies can further strengthen governance practices by enhancing risk management and operational efficiency. Continuous monitoring, stronger regulatory oversight, and increased stakeholder engagement are crucial for improving governance effectiveness. This research provides valuable insights for policymakers, regulators, and banking professionals, offering recommendations to strengthen governance frameworks and promote a resilient and sustainable banking sector. Addressing governance-related challenges will not only enhance financial stability but also safeguard stakeholder interests and contribute to India's long-term economic growth.