Diageo fills up cracks in its corporate governance

Says 146 people have exited for breaching norms

Diageo, the global spirits major, has come down heavily on breaches in corporate governance norms across its global operations. Diageo has said 146 people exited the business as a result of the breaches in its code or policies.

The company, which controls close to 54 per cent of India’s largest spirits company United Spirits, has said that it has seen an increase in the reporting of concerns from some of its acquisitions and emerging markets as it’s code and policies have been embedded there.

The global spirits major, which recently completed acquiring 54 per cent in USL for as much as Rs 18,000 crore, said that there were 831 suspected breaches reported last fiscal, of which 440 were subsequently substantiated. Of the suspected breaches, 299 were reported through SpeakUp, compared with 242 during 2013.

This disclosure comes even as United Spirits is struggling to explain on how it had advanced about Rs 1,350 crore to UB Group's holding company UB Holdings and how the same should be accounted for.

 

“We believe that there are two contributing factors to this increase. First, we have seen an increase in reporting of concerns from some of our acquisitions and emerging markets as our code and policies have been embedded further in these areas. Second, there is greater awareness about SpeakUp amongst all our employees, following refresher training on our code which everyone went through,” Diageo said in a statement to its shareholders.