Will announce new corporate governance norms soon: Sinha

Market regulator Securities and Exchange Board of India (Sebi) is set to announce a new set of guidelines on corporate governance, which could increase transparency and give more power to public shareholders.

“You must be aware that we had already placed a document for consultation on corporate governance. The consultation is almost over and we are going to promulgate our rules very soon,” said U K Sinha, chairman, Sebi, at the CII Corporate Governance Summit.

Sebi had floated a consultative paper  in January on corporate governance norms for listed companies. The paper had made suggestions to realign the existing corporate governance code with that of the new Companies Act.  The new norms could see introduction of a whistle-blowing policy, class action suits, lead independent director and compulsory rotation of auditors.

When questioned whether India Inc was prepared to adapt to these changes, Sinha said, “The question is not whether we are prepared. The question should be are we taking measures to prepare India Inc for long-term growth of business and Industry of the country. India should prepare for it.”

Sebi's corporate governance paper had also made suggestions on giving more powers to independent directors, putting curbs on related-party transactions by companies and enhancing the role of institutional investors by asking these to define a clear voting policy.

Besides align the corporate governance code with listed companies, Sebi in some areas has suggested even stricter norms.