TagCorporate Governance

Supreme Court Enhances Information Rights of Directors in Insolvency Process

In Vijay Kumar Jain v. Standard Chartered Bank (decided on 31 January 2019), the Supreme Court was concerned with the question whether under the Insolvency and Bankruptcy Code, 2016 the resolution professional is obligated to provide to members of the suspended board of directors all relevant documents pertaining to the corporate insolvency resolution process, including the resolution plan. The...

ESG Reporting in India

The NSE Centre for Excellence in Corporate Governance (CECG) has issued its most recent quarterly briefing titled “Environmental and Social Reporting by Indian Companies”, which I have authored. The executive summary is as follows: Recent years have witnessed a strong focus on long-term sustainable value in companies rather than short-term profitability. The need for greater transparency on...

The (Ambiguous) Position of Chairman Emeritus in Corporate Governance

[Priya Garg is a 5th year student at West Bengal National University of Juridical Sciences (WBNUJS), Kolkata] When Ratan Tata, the then Chairman Emeritus of the Tata Group of companies, allegedly exercised his influence over the Group’s directors to dethrone its then Chairman, Cyrus Mistry, because of the former’s dissatisfaction with the latter’s functioning,[1] a new corporate governance issue...

Corporate Governance and Sustainability

Professor Vikramaditya Khanna has authored the latest edition of the NSE Quarterly Briefing titled “Global Asset Managers and the Rise of Long Term Sustainable Value”. The executive summary is as follows: – The largest global asset managers (e.g., BlackRock, State Street) have stated that long term sustainable value (LTSV) is their key goal with respect to the firms in which they invest...

The IL&FS Crisis: Lessons in Governance

The situation involving the Infrastructure Leasing and Financial Services Limited (IL&FS) has raised a number of questions revolving around corporate governance. Are governance failures to blame for the predicament in which the company finds itself? A lot has been said about the role of independent directors, nominee directors, auditors and credit rating agencies. However, one aspect that is...

The Influence of Foreign Investors and Proxy Advisory Firms on Corporate Governance

Institutional investors have begun taking an active role in companies that have dispersed shareholding. This played out demonstrably in the case of HDFC in July when the chairman Mr. Deepak Parekh retained his position in the company by a narrow margin. This was attributable to a number of foreign institutional investors having voted against his continuation in the company. They did so on the...

National Financial Reporting Authority: Is There Really a Need?

[Anirudh Singh is a 4thyear B.A LL.B (Hons.) student of NALSAR University, Hyderabad] On 1 March 2018, the Union Cabinet gave its assent to National Financial Reporting Authority (NFRA), which is considered to be a major development for the regulation of financial auditing in big companies. As recommended by the Standing Committee on Finance in its 21streport, the NFRA will assume its role as an...

Age-limit Criteria for Non-Executive Directors under Amended SEBI Listing Regulations: Prospective or Retrospective?

[Gaurav Pingle is a practising Company Secretary in Pune and can be reached at [email protected]] Introduction On June 2 2017, the Securities and Exchange Board of India (‘SEBI’) constituted a committee under the chairmanship of Mr. Uday Kotak for improving the standards of corporate governance of listed companies in India. On October 5, 2017, Kotak Committee submitted its report to SEBI...

Demystifying ‘Board Inter-locks’ under SEBI’s Amended Listing Regulations

[Gaurav Pingle is a practising Company Secretary in Pune and can be reached at [email protected]] Introduction On June 2 2017, the Securities and Exchange Board of India (‘SEBI’) constituted a committee under the chairmanship of Mr. Uday Kotak for improving the standards of corporate governance of listed companies in India. On October 5, 2017, Kotak Committee submitted its report to SEBI. The...

SEBI Order in the USL Case: Lessons on Tunneling

In countries that are replete with corporate group structures (as in India), it is common to find transactions between a company on the one hand and a counterparty that has some relationship with it on the other. Referred to as a related party transaction (RPT), this could generate benefits if carried out on an arm’s length basis. At the same time, RPTs can be used to divert wealth from listed...

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