The Securities and Exchange Board of India (Sebi) has written to the cabinet secretary that women directors and independent directors (IDs) be appointed for public sector undertakings (PSUs), in compliance with the updated corporate governance norms. “Sebi has taken up the matter with the cabinet secretary through its letter dated June 3,” stated the regulator in a board note.
As of April, almost 90 per cent of listed PSUs had failed to meet the requirement of appointing an equivalent number of IDs as the number of functional directors on their boards, the criteria set by the markets regulator.
There are 68 government-owned companies on the National Stock Exchange (NSE). Of these, says primary market advisory firm Prime Database, 31 did not have a woman director. Private companies are far better, with only 149 of the 1,672 non-PSU companies on the NSE being non-compliant, according to data as of March 31.
“The government shouldn’t have needed this prompting from the regulator; it should have been done already as a pro-active measure,” said Amit Tandon, head of Institutional Investor Advisory Services.
Recently, in the Sebi board meeting, the regulator had decided that for fast-track fund raising through a Follow-on Public Offer and rights issues, the market capitalisation requirement for private and PSU firms would be the same. “Sebi should be seen to be treating all kinds of issuers/promoters uniformly when dealing with an issue,” said Sebi in a board note.
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