Narendra Modi, who recently won a second term as Prime Minister, is looking to overhaul the nation’s corporate governance system that allowed a string of frauds to mar his first stint in office.
IIndependent directors on company boards will soon have to clear an exam before they can be appointed, said Injeti Srinivas, the top bureaucrat in charge of corporate affairs. The government is also seeking a ban on Deloitte Haskins & Sells saying it failed to warn of mounting risks at a major shadow lender, and the banking regulator suspended an EY affiliate this month after finding problems in one of its audits.
Who will watch the watchdogs has become a burning question n India, which has in the past year charged a jeweler with defrauding a state-run lender of more than $2 billion, seen defaults at non-bank financiers send its financial system to the brink of a crisis, and and watched as billionaires toppled into bankruptcy. Observers say the companies’ independent overseers should have detected signs of trouble even before they manifested.
“We want to demolish the myth that independent directors don’t have any fiduciary duty,” Srinivas said in an interview in New Delhi on June 6. “We want to propagate corporate literacy to make them aware of their duties, roles and responsibilities.”
The exam will be an online assessment covering the basics of Indian company law, ethics, and capital market norms among other areas, Srinivas said. While aspiring directors will have a fixed time frame within which they have to clear the exam, they will be allowed an unlimited number of attempts, he said.
Read more at:
http://timesofindia.indiatimes.com/articleshow/69750279.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
IIndependent directors on company boards will soon have to clear an exam before they can be appointed, said Injeti Srinivas, the top bureaucrat in charge of corporate affairs. The government is also seeking a ban on Deloitte Haskins & Sells saying it failed to warn of mounting risks at a major shadow lender, and the banking regulator suspended an EY affiliate this month after finding problems in one of its audits.
Who will watch the watchdogs has become a burning question n India, which has in the past year charged a jeweler with defrauding a state-run lender of more than $2 billion, seen defaults at non-bank financiers send its financial system to the brink of a crisis, and and watched as billionaires toppled into bankruptcy. Observers say the companies’ independent overseers should have detected signs of trouble even before they manifested.
“We want to demolish the myth that independent directors don’t have any fiduciary duty,” Srinivas said in an interview in New Delhi on June 6. “We want to propagate corporate literacy to make them aware of their duties, roles and responsibilities.”
The exam will be an online assessment covering the basics of Indian company law, ethics, and capital market norms among other areas, Srinivas said. While aspiring directors will have a fixed time frame within which they have to clear the exam, they will be allowed an unlimited number of attempts, he said.
Read more at:
http://timesofindia.indiatimes.com/articleshow/69750279.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
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