Insta
High Corporate Governance Standards To Pay Off: NSE To Introduce New Category For Well-Governed Firms
NSE building in Mumbai. (Hemant Mishra/Mint via Getty Images)
National Stock Exchange (NSE) has revealed plans to introduce a new category that will include all companies with high corporate governance standards, reports Business Standard.
“Currently, there is no way to distinguish better-governed companies from others. We believe in incentives. We thought of adopting a system that would drive corporate governance through incentives and complement the current system,” said Vikram Limaye, Chief Executive Officer (CEO) of NSE,
The exchange is expected to soon release a full-fledged corporate governance code which will impose stricter norms on companies than the prevalent regulations in the country. Companies that comply with the code will be made part of the new corporate governance category.
‘’Companies are expected to sign up for these norms in exchange for improved visibility, higher liquidity and better quality investors. This initiative has been inspired by ‘Novo Mercado’ in Brazil, which has been highly successful. If introduced, it would be the first time in India that corporate governance would be driven by incentives rather than mandate,’’ Mr Limaye had earlier stated to BS.
No ‘Independence’ In Governance
Earlier it was reported that over 150 listed companies in India have not appointed the required number of independent directors to their boards as per regulations.
The vital role played by such directors cannot be overstated as they hold powerful CEOs accountable. While several factors were at play, there has been speculation that the near-collapse of IL&FS may have been avoided if independent directors had exercised adequate caution in the company's dealings.
Support Swarajya's 50 Ground Reports Project & Sponsor A Story
Every general election Swarajya does a 50 ground reports project.
Aimed only at serious readers and those who appreciate the nuances of political undercurrents, the project provides a sense of India's electoral landscape. As you know, these reports are produced after considerable investment of travel, time and effort on the ground.
This time too we've kicked off the project in style and have covered over 30 constituencies already. If you're someone who appreciates such work and have enjoyed our coverage please consider sponsoring a ground report for just Rs 2999 to Rs 19,999 - it goes a long way in helping us produce more quality reportage.
You can also back this project by becoming a subscriber for as little as Rs 999 - so do click on this links and choose a plan that suits you and back us.
Click below to contribute.
Latest
