Policy on corporate governance to be out in 60 days, says Moily
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The government is set to come out with the national policy on corporate governance within the next 60 days, corporate affairs minister Veerappa Moily said on Tuesday. A government appointed panel, headed by industrialist Adi Godrej, has already submitted its recommendations to the ministry on the matter.
"We are evolving a national corporate governance policy. It will come within two months," Moily said while participating in the session on 'Value Creation with Good Corporate Governance' organised by industry body CII.
Noting that good corporate governance is a strategic necessity, Moily said the panel has recommended 17 guiding principles on corporate governance and they are being looked at. "These principles cover various aspects such as the responsibilities of independent directors and the functioning of a company's board."
Speaking on the occasion, ITC chairman YC Deveshwar noted that governance is a systemic process and suggested that a rating mechanism would help in assessing overall governance activities at companies.
Moily said the current Companies Bill is essential for an enlightened corporate governance process and is expected to be introduced in Parliament soon. "Also, the government has set up the Damodar Committee to remove procedural bottle-necks. The vision is to make India among the top five nations where doing business is the easiest," he said.
In his remarks, Deveshwar, also past president of CII and chairman of CII-ITC Centre of Excellence for Sustainable Development, said there is a growing inequity that is compounded with environmental degradation and global warming.
"The main problem today is the way value has been traditionally defined, and is limited to the interests of only the consumers and shareholders. Top 10% of the global population own 85% of the total household assets whereas the bottom 50% owns 1%. This pointed to the need for incentives for the corporate sector as it is encouraged to unleash its power to create value in multiple dimensions through enhancing social, economic and environmental capitals," Deveshwar said.