Corporate Governance in India & SEBI Regulations
-
Upload
atif-ghayas -
Category
Business
-
view
2.359 -
download
1
description
Transcript of Corporate Governance in India & SEBI Regulations
Corporate Governance In India And SEBI Regulations
Presented By:Atif Ghayas
Aligarh Muslim University, Aligarh
Here comes your footer
Contents
Introduction Definition Key players Principles of Corporate Governance Objectives of Corporate Governance Corporate Governance in India Securities Exchange Board Of India Satyam Scandal Conclusion
Here comes your footer
Introduction
The last few years have seen some major scams and corporate collapse across the globe.
In India, the major example is Satyam which is one of the largest IT companies in India.
All these events have caused the pendulum of public faith to shift away from free market to a more closely regulated one
Here comes your footer
Definition
A system of law and sound approaches by which corporations are directed and controlled
Corporate governance are the policies, procedures and rules governing the relationships between the shareholders, directors and managers in a company, as defined by the applicable laws, the corporate charter, the company’s bylaws, and formal policies
Here comes your footer
Key players in CG
Management
Board of Directors
Customers
Shareholders
Employees
Regulators
Suppliers
Here comes your footer
Principles in CG
Rights and equitable treatment of shareholders
Interests of other stakeholders
Role and responsibilities of the board
Integrity and ethical behaviour
Disclosure and transparency
Here comes your footer
Objectives of CG
Enhance the performance of companies
Enhance access to capital
Enhance long term prosperity
Provide barrier to corrupt dealings
Impacts on the society as a whole
Here comes your footer
CG in India
The Indian corporate scenario was more or less stagnant till the early 90s.
The position and goals of the Indian corporate sector has changed a lot after the liberalization of 90s.
India’s economic reform programme made a steady progress in 1994.
India with its 20 million shareholders, is one of the largest emerging markets in terms of the market capitalization.
Here comes your footer
Securities Exchange Board Of India
On April 12, 1988, SEBI was established with objective of protecting the rights of small investors and regulating and developing the stock markets in India.
In 1992, the Bombay Stock Exchange (BSE),the leading stock exchange in India, witnessed the first major scam masterminded by Harshad Mehta.
Here comes your footer
Securities Exchange Board Of India
Analysts unanimously felt that if more powers had been given to SEBI, the scam would not have happened.
As a result the Government of India brought in a separate legislation by the name of ‘SEBI Act 1992’and conferred statutory powers to it.
Since then, SEBI had introduced several stock market reforms. These reforms significantly transformed the face of Indian Stock Markets
Here comes your footer
Overstated assets and income
The results announced on October 17, 2009 overstated quarterly Revenues by percent and profits by 97 percent.
The global head of internal audit also illegally obtained loans for the company.
Created 13000 fake salary accounts
Created fake customer identities and generated fake invoices to inflate revenue
Satyam Scandal
Here comes your footer
Satyam Scandal
The CEO was convinced that the gap in the balance sheets reached an unmanageable heights and could not be filled.
Satyam Computer crashed by Rs 139.15 or 77.69 per cent to close at Rs 39.95, after the Chairman`s confession
Bombay stock exchange fell 700 points
The Sensex recorded the biggest single-day loss in the past two months, after Satyam Computers Services, plunged 80 percent.
Here comes your footer
Conclusion
Corporate governance And economic development are intrinsically linked.
Effective corporate governance systems promote the development of strong financial systems
Which, in turn, have an unmistakably positive effect on economic growth and poverty reduction.
THANK YOU