Corporate Governance in Annual Report

This was the part of one of my Power point presentation.

Corporate Governance

•      Corporate governance is the set of processes, customs, policies, laws to control the organization.

•      Include relationships among stakeholders involved and the goals of organization .

•      to reduce or eliminate the principal-agent probles

•      renewed interest in the corporate governance in 2001 after Enron and recently after Satyam scam.

•      Definition: “an internal system encompassing policies, processes and people, which serves the needs of shareholders and other stakeholders, by directing and controlling management activities with good business savvy, objectivity and integrity. Sound corporate governance is reliant on external marketplace commitment and legislation, plus a healthy board culture which safeguards policies and processe”

CG In India Over the years

•      CII Code on Corporate Governance (1998)

•      Kumar Mangalam Birla Committee on Corporate Governance (1999)

•      Recommendations of the Naresh Chandra Committee Report on Corporate Audit and Governance (2002)

•      Narayana Murthy Committee Report: Report of the SEBI Committee on Corporate Governance (2003)

•      Conference on Corporate Governance Trends in India  2004, NFCG formed

•      Clause 49 (2004) (SEBI)

•      Concept Paper on Companies Bill 2004

•      Dr. J.J. Irani Report on New Company's Act

•      Review of companies (Issue of Indian Depository receipts) Rules, 2004

•      Proposed Changes in Clause 49 of Listing Agreement

•      Limited Liability Partnership Bill, 2006

Contents of CG report

•      Company’s philosophy on code of Governance

•      Information on Mangement e.g.Board of Directors

•      Audit Committee Information

•      Subsidiary information and remuneration policy disclosure.

•      Ethics and compliance disclosure

•      General shareholder information and other information for transparency.