Alleyway of Corporate Governance Under the Purview of Kotak Committee Report

Abstract

The SEBI appointed committee which had the aim to provide the recommendations for the purpose of effective implementation of good corporate governance and this committee proposed the separation of roles of Managing Director and the Chairperson of the company, increment in the powers of directors, and called for the superior focus on the concepts such as ‘transparency’ and ‘disclosure of information’ for the same. Moreover, the committee proposed the eligibility criteria for the independent directors, schedules for conducting board meetings and its procedure to take the level of transparency and disclosure to the superior level and includes the intention to improve the quality of governance. After all the analysis, it can be said either which way the scope of this report is implemented into the mechanism of corporate, but the report will undeniably impact the traditional system of family business. This can be said on the grounds that this report endeavors to install the system which will provide balance in the interests of the owner (or, in terms of the ancient kingdoms, Raja) and the stakeholders (or, in terms of the ancient kingdoms, Praja). Therefore, if the recommendations of the report are being followed by the corporation with full consideration, then, in that case, it will provide the best results to the stakeholders and the directors and owner itself. Consequently, this report can be considered as the prominent step for having a sound and prosperous corporate governance structure.

Keywords: Corporate Governance, Corporate Frauds, Transparency, Kotak Committee

JEL Classification: G34, G33