Relationship of Internal Audit Quality and Corporate Governance Measures of Multinational Corporations (MNCs) of Pakistan

Abstract

The internal audit is a primitive element for good corporate governance. This need has been largely felt in the developing countries to enhance and promote the corporate governance mechanism. This research evaluates the implication of internal audit of Multinational Corporations (MNCs) of Pakistan on corporate governance's quality. The outcomes of this research reveal significance of internal audit role in corporate governance of MNCs. The significance of audit committee and management in this aspect is predominant. Similarly the results also show the vitality of corporate governance in terms of quality is significant when there is independent audit department with requisite expertise of auditing. However, the reliability of internal audit is primarily determines the characteristics of management of corporate governance. Contrary to this, the implication of internal audit is insignificant on the external audit workers as well as the board of directors of MNCs in Pakistan.

Islamic Ethics in Business and Finance: Implication for Corporate Governance and Responsibility

“…It is noted that good corporate governance instills a sense of security in creditors and shareholders, fostering trust in the company and its operations (Rahman & Subagio, 2021). Furthermore, good corporate governance helps mitigate conflicts of interest and align stakeholders' interests towards the advancement of corporations, creating mutually beneficial situations (Khan, 2016). A robust corporate governance system is emphasized as necessary to reduce the agency problem and protect stakeholders' interests (Hossain et al, 2019).…”