DISCUSSING ON VARIOUS RULES AND REGULATIONS MADE BY THE DIFFERENT COMMITTEES WITH RESPECT TO CORPORATE GOVERNANCE SO AS TO MAKE THE COMPANIES IMAGE IN A BETTER WAY FOR THE FUTURE GROWTH AND TO IDENTIFIED BY THE STAKE HOLDERS.

1. Corporate Governance
COMMITTES
By:
Sumanraj
II M.COM (IBM)

2. CADBURY COMMITTEE
• Failure of 1980’s and early 1990’s.
• Setup in May 1991.
• By the financial Reporting council the
London stock exchange and accountancy
profession.
• To address financial aspects of CG.
• The committee chaired by Sir Adrian
Cadbury

3. Content of the report
• Reviewing the structure and responsibility
of BOD & recommending code of best
practice.
• Considering role of auditor & addressing
various recommendations to the
accounting profession.
• Dealing with the rights and responsibility of
share holder.

4. Code of best practice
• Concerning on role of BOD, duties of
board and composition.
• Dealing with the role of the outside
executive directors.
• Concerning the executive directors and
their remuneration.
• Addressing questions of financial reporting
and financial controls.

5. Recommendations
• All listed company should fulfill with
code.
• Power of non executive should be
independent and high quality.
• Improving standard of corporate
governance

6. Recommendations
• Highest paid director should be disclosed
in annual report.
• Responsibility of board to present true
financial report.
• Professional and objective relationship b/w
board and auditor
• Encourage the institutional investors.

7. Greenbury committee
• Set up in January 1995
• Chairmanship of Sir Richard Greenbury.
• Confederation of British Industry(CBI)
• To identify good practice in determining
director’s remuneration.
• Final report of group published on 17 July
1995

8. Recommendations
• Remuneration committee.
• Disclosure and Approval provision.
• Remuneration policy.
• Service contracts and compensation

9. • Remuneration committee.
 set remuneration committee of non-executive
director.
Articles of Association should be amended.
Non-Executive Directors with no personal
financial interest.
Board is determine remuneration of non
executive director.
R.C chairman should meet AGM.

10. • Disclosure and Approval provision.
The remuneration committee should make a report
each year
 Company’s policy on executive remuneration,
performance criteria and measurement, pension
provision, contracts of service and compensation
commitments on early termination.
 Full consideration to the best practice.
 The report should also include full details of all
elements in the remuneration package of each
individual Director.

11. • Remuneration policy
Remuneration committees must provide the
packages
Remuneration committees should be sensitive
Eligible for annual bonuses
Executive share options should never be
issued at a discount

12. • Service contracts and compensation
 Remuneration committees should consider
what compensation commitments.
 Remuneration committees should, however,
be sensitive and flexible, especially over
timing.
 Periods should reduce after the initial period.
 Remuneration committees should take a
robust line on payment of compensation

13. Kumara Mangalam Birla
Committee
• Set up by the SEBI in the year 2000.
• Clause 49 of the listing agreement.
• Most of the recommendations accepted
by SEBI

14. Recommendations
Recommendations
Mandatory Non-mandatory

15. Mandatory Recommendations
• Board of Directors.
 Not less than 50 percent.
 Independent director.
 Transaction of non-executive director must be disclosed.
• Audit Committee.
 A qualified and independent.
 Shall meet at least thrice in a year.
• Remunerations of directors.
 Remuneration of Non- executive director shall be decided by
BOD.

16. Contd.
• Board procedure.
 Meeting shall be held at least four times a year.
 A director shall not be a member in more than 10 committees,
or act as chairman of more than 5 committees.
• Management
 To share holder
 Discloser should made by management to the board.
• Share holders.
 Must be provided information about Appointment and re-
appointment.
 Quarterly result.
 Shareholders/Investors Grievance committee.

17. NON-MANDATORY
RECOMMENDATIONS
• Chairman of the board
• Share holders Right
• Postal ballot

18. N.R Narayana Murthy committee
• Established by SEBI.
• Chairmanship of N.R Narayana
murthy.
• To review performance of C.G in India
& make appropriate recommendation.
• Submitted report in Feb 2003.

19. Recommendations

20. Mandatory Recommendation
• Audit committee.
• Risk management.
• Proceeds from IPO
• Code of conduct.
• Directors.
• Non-Executive director compensation.
• Whistle blower policy.
• Subsidiary companies

21. Non-Mandatory recommendation
• Evaluation of Board performance.
• Training of board member.
• Audit qualification.

22. THANK YOU