This presentation explains the concept of corporate governance, its framework, its principles and the stakeholders involved in corporate governance value chain. It further explains how corporate governance creates value in an enterprise and enhances its brand image. It also states the parameters of value measurements

1. VALUE ADDITION TO ENTERPISE THROUGHCorporate governance Pavan Kumar Vijay Managing Director 19/01/2010

2. What is Corporate Governance???

3. Corporate Governance rests with the Vision and Perception of the Leadership

4. and A Leader need to adopt a Vision for Corporate Governance

6. Infrastructure

7. Risk ManagementBest Management Practices are Vital Here Law and Ethics are Vital Here Corporate Governance Framework

8. Principles of Corporate Excellence Fairness to all stakeholders Fairness to all stakeholders Mutual Trust, Transparency and Togetherness Mutual Trust, Transparency and Togetherness Unrestricted Communication and Continuous Feedback Unrestricted Communication and Continuous Feedback Sharing Knowledge, Success Stories and Experience Sharing Knowledge, Success Stories and Experience Sharing Happiness and Concerns Helping Each Other – Round the Clock

9. Infact, these principles are the foundation of Best Governed Organizations' irrespective of their form and size

10. Commitment to well-being and progress of all stakeholders is our age old mantra

11. Satyam Vada Dharmam Chara - Taittariya Upanishad

12. “Forever speak the truth and follow the dharma”

13. Truth : Disclosure of Actual State of Affairs (Transparency in operations and transactions)

14. Dharma: “Dharma is for the stability of society, the maintenance of social order and the general well-being and progress of humankind.” - Karna Parva of the Mahabharata. Verse-58 in Chapter 69

15. Corporates are also expected to use their Capacity, Knowledge and Resources TOWARDS Dharma Maximisation of stakeholders’ value and well-being and progress of humankind THROUGH Truth Transparency, accountability and truthful disclosure of state of affairs

16. This is our own age old mantra of Good Governance

17. Companies that have followed these principles of Corporate Governance have

18. Consistently earned high returns, increased their net worth and enhanced their shareholders wealth

19. Invested significantly in proactive research and development

20. Developed people into ‘achievers’ than just ‘performers’

21. Dealt ethically with customers, government and business partners

22. Maintained and updated their professional management culture, system and processes

23. ..and accomplished

24. WINNING EMPLOYEES GROWING INVESTORS DELIGHTED CUSTOMERS HAPPY SOCIETY XCELLENCE TRUSTED SUPPLIERS SATISFIED GOVERNMENT AND REGULATORS

25. “ Corporate Governance is the application of best management practices, compliance of law in true letter and spirit and adherence to ethical standards for effective management and distribution of wealth and discharge of social responsibility for sustainable development of all stakeholders.” - The Institute of Companies Secretaries of India-

26. Value Addition to Enterprise through Corporate Governance

27. Growing Revenues Growing Profits Growth Growing Market Value

28. Ready Market for New Products Widening Customer Base Widespread Goodwill and Brand Reputation Access to Global Markets Better Access to Human Capital

29. CUSTOMERS INVESTORS EMPLOYEES Enhanced Trust and Confidence of all Stakeholders GOVERNMENT AND REGULATORS SOCIETY SUPPLIERS

30. Leading to…

31. Environment SUSTAINABLE DEVELOPMENT Business Society Civil Society

34. Auditors - Independence compromised to obtain lucrative consulting assignments

35. Employees - Large disparity between the highest and lowest paid employee

37. Difficulty in further raising of capital.

39. Aggressive accounting practices.

40. Incompetence of board members and overriding of audit committees .

42. Legal Norms of CG Concept of Independent Directors & Audit Committees Stricter independence standards for Audit Committees Board Professionalism Whistle Blower Policy Certifications and disclosures Real time disclosure & Shortened deadlines

43. ARE SHAREHOLDERS THE ONLY STAKEHOLDERS ?

44. Corporate Governance Value Chain “Corporate Governance is not related to investors only, though they are most important Beneficiary.”

45. ROLE OF STAKEHOLDERS Supply Funds, Materials and Services Value Addition and Management of Resources Give Opportunity to Co. to Satisfy their Needs SUPPLIERS CUSTOMERS HUMAN RESOURCE Adequate Returns for Funds, Material and Services Supplied Adequate Salary and Security for leading a Happy Life Best Quality Products and Customer Care at Minimum Prices EXPECTATIONS OF STAKEHOLDERS PUBLIC Potential Suppliers, Human Resources and Customers Biological, Economic and Cultural Environment PUBLIC EXPECTS PARTNERHIP FOR SUSTAINABLE DEVELOPMENT Stakeholders in Value Chain

46. Stakeholders’ Stake in Corporate Governance Value Chain 2 : 1 Debt – Equity Ratio 2 : 1 Current Ratio

47. What CG Brings…

49. Compliance

50. Employment

51. Social Commitment

52. Better quality of HR

53. Better Salary

54. Benefits

55. Stability

56. Confidence

57. Security of Funds

58. Safety of interest & principal.

59. Better & Favorable Credit Terms

60. Value Creation

61. Better quality of Products/ Services

62. Cheaper prices

63. Value Creation

70. Relaxation of norms

71. Increase in Goodwill

73. History is Witness D I S A S T E R Outstanding Performance, Higher Profits, Expanded Market Reach and the like FAILS to protect a company which has put good governance & ethics at the back burner…. S U C E S S

74. Secret behind building foundations ..…Only the culture of strict adherence to good compliance can keep a company ahead on sustainable basis , bring in larger profits…

75. Present Status of CG Practices – The CRISIL Experience

76. Value Addition - The CRISIL Experience

77. Thus, Although a lot has been done, but a lot needs to be done.

78. CORPORATES SHOULD ACT LIKE HONEY BEE WHICH SUCK THE NECTAR OF THE FLOWER WITHOUT EFFECTING THE FRAGRANCE AND PRODUCE HONEY FOR THE WELL-BEING OF SOCIETY.

79. THANK YOU