TagCorporate Governance

Zee v. Invesco: Jurisdiction Battle between the High Court and the NCLT

[Neharika Chhabra and Gourav Kathuria are fourth-year B.A. LL.B (Hons.) students at NALSAR University of Law] On 22 March 2022, a division bench of the Bombay High Court in Invesco Developing Markets Fund v. Zee Entertainment Enterprises overturned the judgment of a single judge. It held that section 430 of the Companies Act (the ‘Act’) bars the High Court from adjudicating matters arising under...

Does ESG’s Success in India Threaten the CSR Regime?

[Divyanshu Sharma is a 3rd Year BALLB (Hons) Student at National Law University, Delhi] Corporate social responsibility (‘CSR’) and environmental, social and governance (‘ESG’) investment criteria are two concepts which predominantly affect the investment decisions of a socially oriented investor. According to the UNIDO, CSR is a management concept wherein companies integrate social and...

ESG Rating Providers: Analyzing India’s Proposed Regulatory Framework

[Paridhi Jain is a 5th year B.B.A., LL.B. (Hons.) student at Symbiosis Law School, Noida] Once a niche market for investors, environmental, social, governance (“ESG”) investing has grown over the past few years. The pandemic is being referred to as a “sustainability” crisis and one that has re-invigorated focus on climate change, acting as a wake-up call for investors to prioritize a more...

Widening Chasm between Director Remuneration & ESG Investment in India

[Divyanshu Sharma is a 3rd Year BA LLB (Hons.) student at National Law University, Delhi] The debate regarding the disparity in director remuneration between professional and promoter-group directors has been reignited in a recent study conducted by Institutional Investor Advisory Services. The study has unearthed numerous instances wherein the remuneration granted to promoter CEOs in India is 50...

Voluntary Separation of Chairperson and MD/CEO Roles: Analysing SEBI’s Recent Move

[Priankita Das is an undergraduate student pursuing B.A. LL.B. (Business Law Hons.) at Dr. Ram Manohar Lohiya National Law University, Lucknow] By way of its board meeting on February 15, 2022, the Securities and Exchange Board of India (“SEBI”) amended its mandate on the separation of the roles of chairperson and managing director/chief executive officer (“MD/CEO”) of listed companies to be...

Separating Managing Director and Chairperson: An Economically Sound Decision by SEBI?

[Adhip Ray is a 5th year BA.LLB (Hons.) student at Amity Law School, Kolkata and is the founder of the startup consultancy WinSavvy.com and is a consultant for Patent Professional Corporation (Patent PC), an intellectual property law firm based out of California.] The Securities and Exchange Board of India (SEBI) had, in its March 2018 board meeting, approved an amendment to the Securities and...

New Materiality Threshold for RPTs: Nagging Questions on Shareholder Approval

[Vinita Nair and Sikha Bansal are Partners at Vinod Kothari & Company, Practicing Company Secretaries] Related party transactions (RPTs) are perceived as potential tools for unjust enrichment of those in a fiduciary capacity. Hence, SEBI has recently revamped RPT norms (most of which are to take effect from 1 April 2022) intending to impose a greater scrutiny on RPTs. With the above, all...

Journal on Governance: Call for Papers | Volume V Issue 1

[Announcement on behalf of the Journal on Governance] National Law University, Jodhpur is an institution of national prominence established under the National Law University, Jodhpur Act, 1999 by Rajasthan State Legislation. The University is established for the advancement of learning, teaching, research and diffusion of knowledge in the field of law. About the Journal The Centre for Corporate...

Bombay High Court Order in the Zee-Invesco Case: A Critical Analysis

Among the current wave of shareholder activism in Indian companies is the effort by Invesco, an investor in Zee Entertainment Enterprises Limited, to replace members of the board of directors of Zee, including to remove the company’s managing director and CEO. In September, Invesco, which holds 17.88% of Zee’s equity shares, requisitioned the board to call for an extraordinary general meeting...

Managing Significant Transactions & Arrangements with Subsidiaries: Part 2

[Himanshu Dubey and Payal Agarwal are with Vinod Kothari & Co. Part 1 is available here] Basis for assessment – standalone or consolidated? Having dealt with the parameter to be considered for various transactions, another question that may arise is whether the total revenues or expenses or assets or liabilities, as the case may be, have to be considered on a standalone basis or on a...

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