SEBI’S REVISIONS TOWARDS CLAUSE 49 OF CORPORATE GOVERNANCE

revised-corporate-governance-norms-clause-49-of-listing-agreement-2-638

Sayantani Das*

“You must be the change you wish to see in the world……”

                                                                                                                                              Mahatma Gandhi

 

We live in a dynamic world where the only thing that is constant is change. Nothing is permanent. The journey of life begins with birth and ends with death. In the corporate world, companies come into existence with incorporation and closes down with winding up. But the journey of a company in terms of struggle for existence is a big challenge in the corporate market. So here we are discussing about the revamped of clause 49 of the listing agreement specifying the revised corporate governance norms that came into effect on October 1, 2014. These sparkling amendments are aimed at aligning the SEBI requirements with the provisions of the 2013 Companies Act and are focused at adopting the best possible practice on Corporate Governance. By summarizing the key amendments to clause 49 brought in by the SEBI Circular dated 17th April 2014 and 15th September 2014, respectively, the first change came into force that is with the effect from dated 1st April, 2015 there is a compulsory appointment of woman director at every listed company. By this changes there comes the concept of both ‘Right to quality’ and ‘Women’s Empowerment’. Moreover, the most important part of the company lies over the protection of the shareholders where the company should ensure equitable treatment towards all shareholders including minority and foreign shareholders. Clause 49 is not set back to prove its efficacy towards disclosure and transparency department where the company should ensure timely and accurate disclosure on all the internal and external affairs including the financial reports, performance, ownership and good governance of the company accordingly.  The revised Clause 49 has also inserted the requirement that the company shall disclose the code of conduct for the Board of Directors and the senior management on the official website of the company. Overall the revised position proved to be an appropriate balance between the SEBI regulators to progress the path way of corporate governance and also shown a willingness to consider the practical difficulties comes forward.[1]

 

 

 

 

*Sayantani Das, Assistant Professor (Law) at Indian Institute of Legal Studies, Siliguri, West Bengal.

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