Beruflich Dokumente
Kultur Dokumente
Prepared by : Ankit Mody Jimi Shah Ravin Mehta Hirenv Shilu Ankit Panchasara Bhavin Yogi
Definition
Corporate
governance is the set of processes, customs, policies, laws, and institutions affecting the way a corporation (or company) is directed, administered or controlled.
Factors
1)
First relates to the commitment of management towards the principle of integrity and transparency in business operations.
Second factor involves the legal and administrative framework created by the government of the country in which the business operates.
2)
On the basis of definition, the core objectives of corporate governance can be classified as follows:
Strategic Focus Predictability Transparency Participation Accountability Efficiency and Effectiveness Stakeholder Satisfaction
1) 2) 3) 4) 5) 6) 7)
Evolution of Corporate Governance In first half of 1990 due dssmisal of a few high profile CEO. In 1997 east asian financial crisis occurred. In 2001 high profile collapse of US firms like Enron Corporation and Worldcom Formation of sir George Adrian Hayhurst Cadbury.
CII Code 97 No need for two tiered board Single person should not hold directorships in more than 10 listed companies. Key information listed in the code.
Birla Committee (SEBI) 00 At least 50% are non executives members. Chairman should have office and be paid. No need to present in the code.
Narayana murthy 03 Training of board members is suggested. Compensation should be fixed by board . Information should be presented to every members.
Audit Committee
Cii Companies With Turnover Over Rs 1 Billion should have an audit committee with 3 members, nonexecutive & with clear terms of reference.
Birla Minimum 3 members, with one at least financial and accounting knowledge. AGM to answers shareholders.
Narayana Murthy Whistle blowers should have direct access to information. Committee should be responsible for appointment, removal and remuneration.
Remuneration committee
CII
Reduction in number of nominee directors. FIs should withdraw nominee directors from companies with individual shareholding.
Birla
committee decide packages. Board will decide on remuneration for non executives directors
Narayana Murthy
Subsidiaries should follow the parent companies rules and regulations. Code of conduct for board of members and senior management.
CII
Companies to inform their shareholders about prices and performance. Stock exchange requires ceos and cfos certificate.
Birla
Narayana Murthy
Other issues
CII FIs rewrite loan in some case. Same disclosure norms for foreign and domestic creditors.
Birla Quarterly results should be communicated to investors. Board committee should look into shareholder complaints.
Narayana Murthy Companies making IPO should inform to audit committee of funds. Audit committee advise to board for action in this matter.
which an organizations directors and managers act in the larger interests of the organization and shareholders in particular. It allows more constructive and flexible responds to raise the standards in running and managing a company as opposed to strict statutory requirements. Corporate Governance in India, is mainly on based Birla Committees guidelines, which have three key aspects relating to scope, importance and ambit of corporate governance. These are defined as accountability, transparency, and equality of treatment for all stakeholders.
Some
[A] Focus on Shareholders and Stakeholder : Objective of C.G.- Enhancement of shareholder value, keeping in view the interests of other stakeholder
[B] Framework for both private and public sector companies - two type (i) Mandatory requirements (ii) Non- mandatory requirements [C] Code section relating Board of Directors - Size- 50 %- Non executive directors [D] Code Chairman of Board and Chief Executive: - if Executive Chairman 1/2 Independent Directors in board - if an Executive Chairman 1/3 Independent Directors in board
[E] As per debt funding covenants and for financial or investment institution :
- Nominate the director for protect shareholders interest for it in board.
[I] Code for the annual general meeting : - appointment or reappointment of directors - disclose all information, results and documents presentations - right to vote [J] Role of key management (CEO, Directors etc.) - smooth running
- directors report and management discussion and analysis report about position , performance, its outlook etc. - disclose all material related financial and commercial transactions which have potential of conflict
[K] Code for separate section on C.G. in annual report with compliance report. - non compliance report also highlighted in report any with mandatory
recommendations - send certificate from auditors to shareholder and to stock exchange and attached with directors report
[L] The effectiveness of this framework depend upon the corporate response to support the regulatory framework, ability of regulatory to monitor and pressure from shareholder.
on the control mechanism and assets values, and new generations groups which focus on investment protection and multi-stakeholder interest.
Ownerships remains highly concentrated and family business
Anglo-American:
incorporated.
The companies choose a comfortable regulatory framework and the
stock exchanges.
OECD
(Organization
For
Economic
Cooperation
and
Development) revised a proponent of corporate governance principles throughout the world in 2004.
Corporate governance focuses on transparences, objectivity and
conduct.
governance standards should go beyond the law Be transparent and maintain a high degree of disclosure levels. When in doubt, disclose Make a clear distinction between personal conveniences and corporate resources Communicate externally, in a truthful manner, about how the Company is run internally Comply with the laws in all the countries in which we operate Have a simple and transparent corporate structure driven solely by business needs Management is the trustee of the shareholders' capital and not the owner.
value creation certificate. ICRA It has assigned Infosys 'CGR 1 Infosys is the first company in India to be assigned the highest CGR by ICRA.
Corporate Social Responsibility is a commitment to improve community well being through discretionary business practices and corporate resources.
Social Responsibility
Impact/ Risk
Pollution, Global Warming, Resource Usage, Ecological imbalance, legal noncompliance
Health care and safety, legal noncompliance, Disaster management Income generation, unemployment, social unrest, health & hygiene, education
Environmental Leadership
Quality of life, environmental, safety and health sustainability Improving the quality of life, partnership with society and social license to operate Quality of life and EHS sustainability
Public conduct/ interaction with community & society for capturing their concerns Safety, health and environment education
Initiatives
Tata group pioneer of CSR in India
TATA CONSULTANCY SERVICES (TCS)
Tata MOTORS
Reducing Pollution
At Tata Steel major CSR programme are managed by three organizations Tata Steel
Rural Development Society (TSRDS), Tata Steel Family Initiatives Foundation (TSFIF) and the Tribal Culture Society (TCS).
TSRDS started with 32 villages around Jamshedpur now covers over 700 villages in the
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Institutions
Indian Institute of Science (IISc)
JRD TATA Ecotechnology Centre (JRDTEC) TATA Institute of Fundamental Research (TIFR) TATA Institute of Social Sciences (TISS)
Healthcare
TATA Memorial Centre TATA Medical Centre
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