The Role of Internal Audit in Corporate Governance. Case: Fiat Group
Mauro Di Gennaro, Chief Audit Executive & Compliance Officer, Fiat, Italy
Recently there has been considerable interest in the Corporate Governance practices of modern corporations. New approaches to doing business have increased the risks connected with the achievement of company's goals. The introduction of new technical devises, for instance, the use of the Internet for carrying out transactions massively took off starting from the 1990s onwards. Subsequently, this increased the risks of intrusive attacks, made the issue of business continuity a more critical one and placed a stronger emphasis on the need for disaster recovery plans. Also, the worldwide spread of business into 'new markets', such as the Asian market, has provided new risks as well as refocusing attention on a system of control, for example the Asian financial crisis in the latter half of the 1990s. Moreover, the high-profile collapses of a number of large U.S. firms such as the Enron Corporation and Worldcom in the early 2000s, as well as lesser corporate debacles, such as Adelphia Communications, AOL, Arthur Andersen, Global Crossing, Tyco, and, more recently, Fannie Mae and Freddie Mac, Parmalat, etc. led to increased shareholder and Governmental interest in Corporate Governance which culminated in the approval of the Sarbanes-Oxley Act of 2002 and in the SOX (Sarbanes-Oxley Compliance Projects). Last but not least, the ever stronger institutionalisation of the markets in which buyers and sellers are largely institutions (e.g., pension funds, insurance companies, mutual funds, hedge funds, investor groups, and banks) also reveals an increasing need for professional diligence to protect the community at large in terms of safety and welfare.
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