[The following post is contributed by Shriya Jain, Fourth year student & Param Pandya, Fifth year student of Gujarat National Law University, Gandhinagar, Gujarat. The authors can be contacted at [email protected] & [email protected] respectively]. A government company is defined under section 2(45) of the Companies Act, 2013 (‘2013 Act‘) as a company in which not...
Designing Executive Compensation for Banks and Financial Institutions
When it comes to banks and financial institutions, there are additional corporate governance requirements apart from those applicable to other types of companies. This is because the operation of banks and financial institutions affect the interests of a constituency other than shareholders, namely deposit holders and other creditors. Hence, executive compensation practices need to take these...
Public Sector Undertakings and Corporate Governance
The NSE Centre for Excellence in Corporate Governance (CECG) has issued its most recent quarterly briefing titled “Corporate Governance in State-Owned Enterprises”. The executive summary is as follows: – State-Owned Enterprises (SOEs) constitute an integral part of India’s economy, and their performance has generally been encouraging; – They are subject to stringent governance norms:...
Analysing the KBR Case through Indian Corporate Law
[The following guest post is contributed by Suprotik Das, a 3rd year law student at the Jindal Global Law School, Sonepat, Haryana. This is a follow-up to a previous post “Whistleblowing and Confidentiality Agreements”.] KBR, a US company, required employees and former employees to sign confidentiality agreements when they were being interviewed for internal compliance issues with...
Whistleblowing and Confidentiality Agreements
Earlier this week, the US Securities and Exchange Commission (SEC) issued a settlement order in a case involving a company that required its employees to sign a confidentiality agreement when they were interviewed in internal investigations for allegations of potential violations of federal securities laws. The SEC decried the use of such confidentiality agreements as militating against laws that...
Gender Diversity on Corporate Boards: The Need to Move Beyond Rhetoric
Over the last few days, the financial press has been abuzz with the efforts of listed companies in India to recruit at least one woman director on their board in order to comply with the requirement under clause 49 of the listing agreement that takes effect today. This requirement also emanates from the Companies Act, 2013. In a last-minute scramble, it is estimated that as many as 250 companies...
Rule Change for E-Voting
[The following guest post is contributed by Nidhi Bothra and Vinita Nair, Vinod Kothari & Co, Corporate Law Services Group. The authors can be contacted at [email protected] and [email protected] respectively] Under the erstwhile system of holding general meetings, the resolutions were put to vote by way of show of hands or a poll could be demanded. Since only such members who were...
East India Company and Modern Corporations
William Dalrymple has an interesting piece in the Guardian that compares the East India Company (EIC) with modern corporations. He seeks to demonstrate that some of the factors that perpetuated the EIC’s dominance in the corporate and political world for several centuries are found in modern corporations as well, albeit in more measured terms. The kind of power that was wielded by the EIC is...
The State of Shareholder Activism
The latest issue of the Economist carries two pieces (here and here) arguing about the importance of shareholder activism as a means to enhance the management and governance of companies. The magazine appears to extol the virtues of activism in the current economic environment, although some might dispute whether activist investors have had as much of a positive role to play in corporate...
Briefing on Related Party Transactions
The NSE Centre for Excellence in Corporate Governance has published its quarterly briefing on “Related Party Transactions”, which has been authored by Professor Vikramaditya Khanna. The executive summary is as follows: – Related Party Transactions (RPTs) are a topic of increasing interest around the world, especially as some of them have been associated with quite well known frauds. –...
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