Corporate governance raises more questions

The conference was supposed to give a roadmap to the future of corporate governance in India. At the end, however, everyone merely hoped that corporate governance would continue to improve and there were no clear answers to the questions raised.

At a conference organised by the Institute of Companies Secretaries of India (ICAI) here today, speakers preferred to ask more questions: Are corporate governance ratings a good thing? How can directors be independent if they are hand-picked by promoters? etc etc.

Naresh Chandra, former Cabinet secretary, kicked off the panel discussion by saying the "board has to decide whether they are for 'conformance' or performance. There are cases where independent directors do not act and then in some cases they resign without giving any reason, and after some time we see the company going down."

"There is not a single company in India which has provided for proportional representation on the board of directors," pointed out Professor Manubhai Shah, Trustee, Consumer Education and Research Centre. According to him, corporate governance has to focus on the rights of the minority shareholders.

Sunil Munjal, president, Confederation of Indian Industry (CII), asked for realistic laws on the issue which could be implemented.

Last year, Reliance Industries vice chairman and managing director Anil Ambani received the award for best corporate governance on behalf of the company "" a fact to which attention was drawn by one of the panel members while referring to the state of affairs in the company.

Hero Honda Motors and Wipro were presented the Best governed companies award in the private sector for the year 2004. Premchand Gupta, Minister of Company affairs gave away the awards to Brijmohan Lall Munjal, Chairman, Hero Honda and PM Sinha, Director, Wipro at a function held in Vigyan Bhawan.

The best governed company in the public sector was won by: Tamil Nadu Newsprint and Paper (TNPL). Rameshram Mishra, Chairman, TNPL received the award on behalf of the company.

The award for lifetime achievement went to Keshub Mahindra, Chairman, Mahindra & Mahindra for translating excellence in Corporate governance into reality.

Arun Nanda, Executive Director, Company Secretary and President (infrastructure Development Sector), Mahindra & Mahindra received the award on his behalf.