Corporate Governance Review Practice

(Executive Summary)

The scope and significance of corporate governance in India increased sizeably in the recent period, particularly following the financial sector reforms. As Indian corporates are finding new space in domestic and global markets for business growth, their interaction with the financial markets and investing community too witnessed significant surge. In this process, corporate governance came as an effective instrument for companies to communicate with the various types of stakeholders in general and investors in particular.

What began as an industry initiative of CII, corporate governance today became an essential part of the culture that defines better run companies and those held in esteem by the investors and stakeholders. As the rigour of the regulation intensified, governance standards began to be codified and formed an important part of the evaluation and assessment process. Clause 49 of the Listing Agreement of the Stock Exchanges is the key instrument that drives compliance of the corporate governance standards and practices by companies.

Stock Exchanges and regulatory authorities which receive the compliance reports of the companies regularly assess the record of performance in this regard and take relevant actions. Securities and Exchange Board of India sending notices to 20 companies amongst which there are five public sector undertakings, is an instance of review processes following the receipt of information and filing of reports on compliance of corporate governance norms. Such measures will make companies more alert in adhering to the stipulated norms and guidelines.

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Comments / Suggestions / Inputs may please be forwarded to:

The Executive Director
National Foundation for Corporate Governance
E-mail : ed.nfcg@cii.in

Shalini Budathoki
Director (CII), NFCG
E-mail : shalini.budathoki@cii.in

 

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