Corporate Governance

The SEBI, the designated capital market regulator has a sort of mixed record in fostering and nurturing corporate governance in the Indian corporate sector. Since its inception in 1992, SEBI has registered substantial growth in its stature and reach.

Role of SEBI

Power of SEBI

Structure of SEBI

Poor tackling of price manipulation and insider trading issues: ‘Insider trading

Why SEBI is the custodian/watch dog of corporate India?

Insider trading.

Kumar Mangalam committee and recommendations

Naresh Chandra committee

Birla committee 2002

Narayan Murthy committee

Clause 49

SEBI had in the revised Clause 49 of the Listing Agreement mandated that at least 50 per cent of the board of a listed company comprise independent directors. The capital market regulator has made it clear that the corporate India should comply with revised Clause 49 by 31 December 2005.

JJ Irani

the J.J. Irani Committee has recommended that one-third of the board of a listed company should comprise independent directors. The committee has also suggested that corporates should be allowed to maintain pyramidal corporate structures, that is, a company which is a subsidiary of a holding company could itself be a holding company. The main thrust of the committee’s recommendations were to give full liberty to the shareholders and owners of the company to operate in a transparent manner. The committee calls for a significant shift from a government approval regime to a ‘shareholder approval and disclosures’ regime. The report thus gives more power to shareholders, allowing them rather than the company law administration to decide on certain crucial matters.

Rajat Gupta insider trading

Magma Financial services

Sahara scam

OECD act

SOX act

Satyam computers case

Established on 24 June 1987 by B. Ramalinga Raju and his brother-in-law, D. V. S. Raju, Satyam Computer Services Limited was incorporated in 1991 as a public limited company. In a short time, it became a leading global consulting and IT-services company spanning 55 countries. During its heyday, it was ranked as India’s fourth largest software exporter, after TCS, Infosys and Wipro, and was one of the few Indian IT services companies listed on the New York Stock Exchange (NYSE). falsified the accounts, inflated the share price, and stole large sums from the company. Much of this was invested in property. It was acquired by Mahindra Tech., earlier MBT. Inspite of having regulatory acts like SEBI and SOX, there are still fraud happening.

SBI, HDFC

What is the role of other regulatory boards in corporate governance?

Rating agencies.