Essar Forms Internal Panel On Corporate Governance

The Essar group has set up an internal management committee comprising heads of various group companies to advise it on corporate governance. The move comes after the Ruias' proposed governing council plan with well-known corporate professionals as members failed to take off.

The Ruias are also introducing internal audit committees in all their companies to usher in greater transparency. At present, only Essar Oil has an audit committee.

The eight-member management committee, which does not include members of the Ruia family, is chaired by Essar Oil managing director Sukhbev Singhji. The committee, which will act as a watchdog, will monitor performance and take up future plans of the group companies. It will also ensure that various checks and balances have been put in place in each of the companies.

 

The committee will make its recommendations to the board of directors and help guide its policies.

The committee consists of heads of various companies, including Essar Oil, Essar Steel. Essar Shipping, South India Shipping Corporation, Essar Telecom and also group directors handling a particular function like finance director R V Venkatesan.

A senior company executive said: "We decided to go one step ahead. So, instead of the governing council, we decided to set up an advisory committee of (our own) people who will act as the watchdog for the group."

The Ruias had earlier tried to rope in corporate celebrities as members of the proposed governing council which was to be an independent group advising Essar on corporate governance and providing direction. But the plan was shelved because most personalities who were approached were reluctant to be part of such a council.