Tag: Executive Compensation
-
Compensation Arrangements between Private Equity and Company Management: Corporate Governance Issues
[Posted by Umakanth Varottil] In its board meeting held on 23 October 2016, the Securities and Exchange Board of India (“SEBI”) highlighted the issue of compensation arrangements agreed to by private equity (“PE”) firms with the promoters, directors and key managerial personnel (collectively, the “management”) of investee companies that are listed on the stock exchange,…
-
The Companies Law Committee on Section 117 and Appointment and Remuneration of Managerial Personnel
[Posted by Umakanth Varottil] [The following guest post is contributed by Amitabh Robin Singh, who is an Associate at DSK Legal] In an earlier post, this author had discussed the proposed changes made by the Companies Law Committee (“Committee”) to Chapter 3 (Prospectus and Allotment of Securities) of the Companies Act, 2013 (“2013 Act”). In this…
-
Designing Executive Compensation for Banks and Financial Institutions
[Posted by Umakanth Varottil] 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…
-
Executive Compensation and Corporate Governance
[Posted by Umakanth Varottil] Although the issue of executive compensation has not been as dominant in the corporate governance discourse in India as it has been in other leading economies, it has begun to attract significant attention lately. While we have not had a chance on this Blog to touch upon the recent debates, it…
-
Shareholder Power: Say-on-Pay
[Posted by Umakanth Varottil] Recent Developments in the US: Dodd Frank Act, section 951, requires companies to approach shareholders for their non-binding vote on executive compensation and golden parachutes. Recent Developments in the UK: A new proposal would require companies to approach their shareholders for a binding vote on executive pay. Existing Position in India:…
-
Regulating the Pay of Bankers in the Private Sector
[Posted by Umakanth Varottil] Last week, the Reserve Bank of India (RBI) issued compensation guidelines for implementation by private sector and foreign banks that become operational from the financial year 2012-2013. This approach is consistent with the trend that corporate governance norms in the banking sector tend to be more controlled than in other industry…
-
Managerial Remuneration in Unlisted Companies: Process Eased
[Posted by Umakanth Varottil] When the rest of the world is tightening the screws on payment of managerial remuneration in the wake of the financial crisis, the Ministry of Corporate Affairs (MCA) in India has eased the process for such payments in the case of unlisted companies. However, this is certainly understandable. The erstwhile process…
-
Regulating Bankers’ Pay
[Posted by Umakanth Varottil] Consistent with international trends to impose greater regulation on executive compensation in banks, the Reserve Bank of India (RBI) has issued draft guidelines on compensation of whole time directors/ chief executive officers / risk takers and control function staff. This applies to private sector and local area banks and all foreign…