Corporate Governance in India Clause 49 of Listing Agreement

Abstract

This paper traces the origin and development of corporate governance practices in India starting from CII Code on Corporate Governance, Birla committee report and Narayan Murthy committee report and examines the recent amendments to Clause 49 of listing agreement in India.

Corporate Governance is essentially all about how organizations are directed, controlled and held accountable to the shareholders. Securities and Exchange board of India is continuously working in regulating the corporate in India to protect the interest of various stakeholders. A voluntary disclosure, which was started by some of the well-managed socially concerned companies, has become an order of the day in corporate reporting.

The ability of the Board, the commitment of the individual members of the Board, the integrity of the management team, alertness of the inspection and audit team, adequacy and quality of the process and reporting are the real factors which will ensure good corporate governance.

The positive side of adherence to corporate governance practices has increased importance of corporate governance as investment criteria among large investors, Improved Equity Price Performance, Higher Valuations, Access to global markets and increased investor goodwill & confidence.

Keywords: Corporate governance, clause 49, listing agreement, investor protection