The Securities and Exchange Board of India (Sebi) chairman D R Mehta said unlisted companies should disclose their investments in associate firms and subsidiaries as a step towards better corporate governance.
"This will, to some extent, expose the problems in a particular company as well create confidence among investors," he said.
Mehta also urged the Department of Company Affairs to decide on whose jurisdiction these companies fall.
"In several cases these companies have been floated by the employees of the companies and no disclosures is made," he said.
Mehta also urged public sector units to follow corporate governance norms.
Meanwhile, speaking at the second international corporate governance here, Mehta said Sebi is planning to make it mandatory for companies to disclose on a quarterly basis, any change in investments of its subsidiaries or associate firms or a partnership, which deals in shares or securities.
The regulator plans to introduce new norms on this score whereby front-end investment companies will have to disclose to the stock exchanges their holding in subsidiary/ associate company/ partnerships set up by them for the purposes of investments on a quarterly basis.
These measures are part of several that the watchdog plans to take to prevent/ minimise manipulation of stock prices.
Meanwhile, M Damodaran, chairman of Unit Trust of India, said that timely disclosure of information and development is the simple form of corporate governance.
The last decade as most eventful and various reforms have been carried out by the market regulator.
Till date, 141 companies on the Bombay Stock Exchange (BSE) and 110 on the National Stock Exchange (NSE) have adopted full corporate governance norms.
And 62 and 40 newly listed companies on the BSE and NSE, respectively, have complied with full corporate governance norms.
