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Corporate Governance Essay

4897 words - 20 pages

Question No. | Answer |
1 | a. Well-developed equity market & dispersed ownership |
2 | c. Voluntary practices |
3 | a. Advertising |
4 | a. Monetary Policy |
5 | c. That portion of bank’s total cash reserves which they are statutorily required to hold with the RBI. |
6 | b. The Greenbury Committee, 1995 |
7 | b. Bank |
8 | d. Harshad Mehta scam, 1992 |
9 | b. Diffused Debt |
10 | a. Director |
11 | b. De Facto |
12 | b. Independent auditors |
13 | a. Ganguly Group |
14 | c. Bribery |
15 | c. The Pluralistic Model |
16 | a. The National Environment Policy, 2004 |
17 | b. Dhanuka Committee |
18 | a. It lays down the framework for creating long-term ...view middle of the document...

Revised Clause 49 of the Listing Agreement in India requires all listed companies to file every quarter a CG report. According to SEBI guidelines (visit www.sebi.gov.in), “The key mandatory features of Clause 49 regulations deal with the followings: composition of the board of directors, the composition and functioning of the audit committee, governance and disclosures regarding subsidiary companies, disclosures by the company, CEO/CFO certification of financial results, and reporting on CG as part of the Annual Report.” Moreover, Clause 49 also requires companies to provide “specific” corporate disclosures of the followings: related-party transactions, disclosure of accounting treatment, if deviating from Accounting Standards, risk management procedures, proceeds from various kinds of share issues, remuneration of directors, a management discussion and analysis section in the annual report discussing general business conditions and outlook, and background and committee memberships of new directors, as well as, presentations to analysts. In addition, a board committee, with a non-executive chair, is required to address shareholder or investor grievances. Finally, share transfer, a long-standing problem in India, must be done expeditiously (Patel, 2006).The revised Clause 49 has suitably pushed forward the original intent of protecting the interests of investors through enhanced governance practices and disclosures. The revised Clause 49 moves further into the realm of global best practices (and sometimes, even beyond). In this connection, Chakrabarti (2008) very aptly commented as: “Similar in spirit and scope to the Sarbanes-Oxley measures in the USA, Clause 49 has clearly been a milestone in the evolution of CG practices in India.” It is now mandatory for the Indian listed companies to file with the SEBI, the CG compliance report, shareholding pattern along with the financial statements. Requirements of Clause 49Clause 49 of the Listing Agreement has introduced a slew of requirements aimed at strengthening corporate governance. The highlights of the requirements are: 1. Half the board of directors must be independent directors. 2. The board must lay down a code of conduct for all board members and senior management, and must record an annual affirmation. 3. The audit committee has oversight of the financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible. 4. The company must lay down procedures to inform the board about the risk assessment and minimization procedures, which shall be periodically reviewed to ensure that executive management controls risk through a properly defined framework. 5. A management discussion and analysis report must form part of the annual report to the shareholders, which must include discussion on matters such as internal controls and their adequacy. 6. The chief executive officer (CEO) and chief financial...

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