Corporate Governance Rules.
The Securities and Exchange Board of India (Sebi) panel on corporate governance led by Uday Kotak proposed sweeping changes. The recommendations are listed below:
a) Panel proposed more powers for independent directors, limiting chairmanship to non-executive directors, and called for a greater focus on transparency and disclosures to improve corporate governance.
b) The panel recommended that a listed company should have at least six directors on its board. Current Sebi regulations do not mandate a minimum number. The panel has suggested at least one independent director be a woman.
c) It also proposed that directors attend at least half the total board meetings held in a financial year. If they fail to do so, they would require shareholders’ nod for continuing.
d) Companies have asked to make public the relevant skills of directors, and the age of non-executive directors has been capped at 75 years.
e) In addition, the chairperson of a listed company will be a non-executive director to ensure that s/he is independent of the management.
f) An independent director cannot be in more than eight listed companies and a managing director can hold the post of an independent director in only three listed companies.
g) The committee has recommended that the number of independent directors on a company board be increased from 33% to 50%.