India Proxy Season 2012 Analysis
November 2012
InGovern Research ServicesShriram Subramanian
Founder and Managing Director
Contents
2
2012 AGMs –Proposals Analysis
Corporate Governance
Structure of Top 100 Companies
Key Developments for Investor
Protection in 2012
New Companies Bill – Key Provisions
About Us
2012 AGMs – Post Meeting Analysis
Contents
3
2012 AGMs –Proposals Analysis
Corporate Governance
Structure of Top 100 Companies
Key Developments for Investor
Protection in 2012
New Companies Bill – Key Provisions
About Us
2012 AGMs – Post Meeting Analysis
InGovern - Company Snapshot
First Proxy Advisory company in India
Fostering institutional shareholder activism in India
Featured on:
Advisory panel of corporate governance experts
Sale and distribution of InGovern vote recommendations
on ProxyEdge, Broadridge’s proprietary platform
4
About Us
InGovern - Vote Recommendations
5
Coverage for S&P CNX 500 and BSE 500: Universe of 588 cos. (over 95% of marcap)
Meeting Types: AGMs, EGMs, Postal Ballots, Court Convened Meetings
Vote recommendations done on the basis of detailed Policy Guidelines
Each resolution analysed with Reco to vote FOR, FOR* or AGAINST
FOR*: Shareholders advised to seek clarifications from the company
Don’t recommend ABSTAIN unless data insufficient or lack clarity to arrive at judgment
Recommendations sent to Company prior to meeting
About Us
InGovern - “Governance Radar” Policy
•Appointments, Compensation, Meetings, Remuneration, Responsibilities, Chairperson, Code of Conduct, Company Secretary, Independent Directors etc.
Board
•Audit, Nomination, Shareholders, Risk, Remuneration Committees
•Composition, Meetings, Powers, ResponsibilitiesBoard
Committees
•Code of Conduct, Remuneration Policies, Risk Management, Whistleblower Policies
Management & Operations
•Audit & Accounts, Auditor Independence, Ethical Standards for AuditAudit &
Accounts
•Related Party Transactions, Shareholders Meetings & Voting, Other RightsShareholders
Rights
•Audit & Accounts, Board (Appointments, Composition, Remuneration, Meetings), Board Committees, Independent Directors, Management & Operations, Ownership, Shareholder Meetings, Whistle Blower Policies, etc
Disclosures
6
Approximately 400 criteria evolved
About Us
Contents
7
2012 AGMs –Proposals Analysis
Corporate Governance
Structure of Top 100 Companies
Key Developments for Investor
Protection in 2012
About Us
2012 AGMs – Post Meeting Analysis
New Companies Bill – Key Provisions
Month-wise Breakup of Resolutions
8
2012 AGMs
Nifty 11 0 24 0 7 61 95 92 182 9 0 0
Junior Nifty 0 0 6 20 0 33 143 104 78 0 0 0
Other S&P 500 13 19 31 150 60 154 640 704 1050 41 9 0
Other BSE 500 0 14 6 21 37 19 80 97 261 0 0 0
Total 24 33 67 191 104 267 958 997 1571 50 9 0
0
250
500
750
1,000
1,250
1,500
1,750
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Nu
mb
er o
f Res
olu
tio
ns
Index Wise Monthly Resolutions
89%
11%
Management Shareholder
87%
13%
Ordinary Special
Number of Resolutions Tabled
9
4,271 Resolutions Proposed in 2012 AGMs
2012 AGMs
Type of Resolution Resolutions Proposed By
Shareholder Resolutions
460 resolutions proposed; most were friendly resolutions
458 resolutions were for Appointment of Directors
2 resolutions were for Appointment of Auditors
10
2012 AGMs
Shareholder Proposals By Index Shareholder Proposals by Type
23%
9%
58%
10%
Nifty
Junior Nifty
Other S&P 500
Other BSE 50099.6%
0.4%
Appointment of Directors
Appointment of Auditors
Shareholder Resolutions – Few Examples
11
2012 AGMs
Company Resolutions Proposed
HCC Appointment of Dr. Ila Patnaik as a Director
Kansai Nerolac Paints Appointment of Mr. H. Nishibayashi as a Director
IDFC Appointment of Mr. S. S. Kohli as a Director
HDFC Appointment of Dr. J. J. Irani as a Director
Exide Industries Appointment of Auditors and fixing of remuneration
Torrent Power Appointment of Shri D. J. Pandian as a Director
Finolex Industries Appointment of Mr. Sanjay Asher as a Director
GMR Infrastructure Appointment of Mr. N. C. Sarabeswaran as a Director
D B Realty Appointment of Mr. Shahid Balwa as a Director
United Spirits Appointment of Mr. Ghyanendra Nath Bajpai as a Director
Slate Resolutions
26 slate resolutions proposed in 2012
InGovern recommends voting AGAINST slate resolutions
For Appointment of Directors InGovern recommends one resolution per Director
12
2012 AGMs
Slate Resolutions By Index Slate Resolutions by Type
19%
4%
8%69%
Nifty
Junior Nifty
Other S&P 500
Other BSE 500
65%
8%
12%
12%4%
Director Appointments
Dividend Declaration
ESOP Schemes
Appointment of Auditors
Other Slate Resolutions
Slate Resolutions – Few Examples
13
2012 AGMs
Company Type of Resolution Proposed
Hindustan Unilever
Re-appointment of Directors: (a) Mr. Harish Manwani, (b) Mr. Sridhar Ramamurthy, (c) Mr. A. Narayan, (d) Mr. S. Ramadorai, (e) Dr. R. A. Mashelkar, (f) Mr. Pradeep Banerjee
MTNLRe-appointment of Director: (a) Dr. Rajan Saxena, (b) Shri Kumar Sanjay Bariar
NMDC
Re-appointment of Directors: (i) Shri N.K. Nanda, (ii) Shri S. Thiagarajan, (iii) Shri S. Bose, (iv) Lt. Gen. (Retd.) Arvind Mahajan, (v) Shri R.N. Aga, (vi) Smt. Parminder Hira Mathur, (vii) Shri D. Rath
BoschRe-appointment of Directors: (i) Mrs. Renu S. Karnad, (ii) Mr. Prasad Chandran and (iii) Mr. V. K. Viswanathan
Bata India Re-appointment of Directors: (a) Mr. J. Carbajal, (b) Mr. J. Clemons
UnitechAppointment of (a) Statutory Auditors, (b) Branch Auditors and fixing of remuneration
Note: Although InGovern recommends AGAINST slate resolutions, separate recommendations are also given to shareholders for each of the sub agenda proposed under these slate resolutions.
Non-Routine Resolutions
14
2012 AGMs
Type of Resolutions Proposed# of Resolutions
Proposed
Authorization of CMD to set and revise Executive Directors’ remuneration 1
Continuation of Whole-time Directors in spite of attaining Retirement Age 1
Re-utilization of IPO issue proceeds 3
Change of status of directors not liable to retire by rotation 3
Approval to make donations and contributions to charitable funds 5
Alteration in Articles of Association to provide for share buybacks for PSUs 8
Waiver of excess remuneration to whole-time directors 10
Non-Routine Resolutions – Few Examples
15
2012 AGMs
Company Resolutions Proposed
Standard Chartered Authority to make donations to political parties and incur political expenditure
Coal India Alteration in Articles of Association to provide for share buybacks
Adani Enterprises Approval to contribute to charitable funds
Ranbaxy LaboratoriesPayment of remuneration of Rs. 54.78 million made to CEO & MD and waiver
of excess remuneration
Adani PowerWaiver of recovery of excess remuneration paid to Mr. Ravi Sharma Whole-
Time Director
Mahindra Holidays &
ResortsModify or extend the period of utilization of the IPO proceeds
Godrej Properties Amend the schedule of deployment and utilization of the IPO proceeds
Jindal Steel & Power Authorization of CMD to set and revise Executive Directors’ remuneration
Bajaj Finance Change of status of Rahul Bajaj as a director not liable to retire by rotation
PSLContinuation of Mr. R. K. Bahri as whole-time director in spite of his attaining
the age of 70 years
16
2012 AGMs
Other Resolutions on Major Corporate Actions
Type of Resolution Proposed
# of
Resolutions
Proposed
Few Examples of Companies
that Proposed the Resolution
Alteration to MoA/ AoA 87
Coal India, SAIL, NTPC, NMDC, Escorts, IDFC, Eicher,
Mastek, Wipro, Gammon Infra, MRPL, Aventis Pharma,Essar Ports
Issue of Securities 70
Ashok Leyland, Jindal Stainless, Jet Airways, Cox & Kings,
Gulf Oil Corp., Essar Ports, Jain Irrigation Systems, ReliancePower, Adani Enterprises, GTL Infrastructure, Yes Bank
Grant of ESOPs/ Modification
to existing ESOP schemes46
ICICI Bank, Hindustan Unilever, OnMobile Global, India
Infoline, Fortis Healthcare, Zensar Technologies, EssarPorts, Godrej Industries, Dr. Reddy's Laboratories
Increase in borrowing limits 25
Indiabulls Financial Services, Kotak Mahindra Bank, BASF
India, Power Grid Corporation, REC, United Breweries, Cox& Kings,
Creation of mortgage/charges
on assets of the Company31
Shriram Transport Finance, HEG, Kesoram Industries,
IL&FS Transportation Networks, Ashok Leyland, REC,Power Grid Corporation, Hindalco Industries, Jain
Irrigation Systems, India Cements
Other Resolutions on Major Corporate Actions
17
2012 AGMs
Type of Resolution Proposed
# of
Resolutions
Proposed
Few Examples of Companies
that Proposed the Resolution
Increase / Sub-division of
Authorized Share Capital13
Religare Enterprises, Reliance Communications, Amara
Raja Batteries, Oberoi Realty, GTL Infrastructure, MagmaFincorp, India Glycols,
Change in place of keeping
Company Records9
Sterlite Industries, Agro Tech Foods, Gulf Oil Corporation,
Wyeth, NCC, Educomp Solutions, Taj GVK Hotels &Resorts
Intercorporate investments/
Providing guarantees8
Bajaj Finserv, Jet Airways, JBF Industries, Zuari Global
Limited
Increase in the FII holding
limits5
Gujarat Pipavav Port, HDFC, Kotak Mahindra Bank, AIA
Engineering, ENIL
Issue of bonus shares 1 Motherson Sumi Systems
Delisting of Securities 1 Mahanagar Telephone Nigam Limited
Contents
18
2012 AGMs –Proposals Analysis
Corporate Governance
Structure of Top 100 Companies
Key Developments for Investor
Protection in 2012
About Us
2012 AGMs – Post Meeting Analysis
New Companies Bill – Key Provisions
Board Size
19
InGovern recommends: 7 to 16 Directors
CG Structure of Top 100 Companies
“10% of companies have board sizes of either more than 16 directors or less than 7 directors”
0
15
30
45
60
75
Less than 10 Directors
Between 10 and 15 Directors
More than 15 Directors
Company Directors
Jaiprakash Associates 20
Larsen & Toubro 17
NTPC 17
Bharat Electronics 17
Sesa Goa 6
IDBI Bank 6
Reliance Capital 6
Zee Entertainment Enterprises 6
Reliance Communications 5
Reliance Power 5
Classification by Board Size
Average Board Size: 11
Board Composition
20
* IDs: 1/3 if Chairman is independent; 1/2 otherwise
CG Structure of Top 100 Companies
“9% of companies were non compliant with Clause 49; with <50% IDs and no Independent Chairman”
Company % of IDs
Power Grid Corporation of India 25%
Container Corporation of India 30%
Hindustan Petroleum Corporation 33%
Adani Enterprises 40%
Bharat Petroleum Corporation 40%
Bharat Heavy Electricals 43%
Union Bank of India 45%
Tata Power Company 46%
NTPC 47%
The percentage of IDs on Top 100 Indiancompanies is approximately 54%
9 companies did not have an IndependentChairman and had more than 50% IDs andhence were not Clause 49 compliant
Ambuja Cements, HDFC Bank, Infosys,Kotak Mahindra, Siemens and FederalBank had the ideal board compositionfrom a corporate governance perspectivewith more than 50% IndependentDirectors and an Independent Chairman
Sesa Goa: No chairman as of Mar 31, 2012
Contribution at Board Meetings
21
CG Structure of Top 100 Companies
Company Director RoleBoard Meeting
Attendance*
Bajaj Auto Mr. J. N. Godrej ID 0%
Jaiprakash Associates Mr. Pankaj Gaur MD 0%
Hero MotoCorp Mr. Analjit Singh ID 0%
IDFC Mr. Bimal Julka NED 0%
United Phosphorus Mr. K. Banerjee ED 0%
Hindalco Mr. Ram Charan ID 14%
Maruti Suzuki Ms. Pallavi Shroff ID 17%
Hero MotoCorp Dr. Anand Burman ID 20%
Jaiprakash Associates Mr. Ranvijay Singh ED 20%
ITC Mr. Dinesh Mehrotra ID 29%
Cipla Mr. VC Kotwal ID 33%
“One in Five Directors attend less than 75% of Board Meetings”
*Note: Attendance is calculated only for Board Meetings held in FY 2012 for the respective companies, however InGovern recommends shareholders to also take into consideration the attendance for AGM and committee meetings prior to their voting.
List Not Exhaustive
22
CG Structure of Top 100 Companies
List Not Exhaustive
Independent Directors – Outside Directorships
InGovern recommends AGAINST IDs with > 10 Public Directorships and/or >20 Private Directorships
“9% of Independent Directors have outside directorships in more than 10 public companies”
Company Independent Director# of Outside
Directorships
Siemens Mr. Deepak S. Parekh 16
Biocon Mr. Suresh N. Talwar 15
Asian Paints Mr. S. Ramadorai 14
Colgate Palmolive India Mr. R. A. Shah 14
HDFC Mr. B. S. Mehta 14
Hindalco Mr. C. M. Maniar 14
Ambuja Cements Mr. Nasser Munjee 13
Ambuja Cements Mr. Shailesh Haribhakti 13
ITC Mr. Sunil Behari Mathur 13
23
CG Structure of Top 100 Companies
List Not Exhaustive
Independent Directors – Tenure
InGovern recommends AGAINST IDs > 9 years on Board
“22% of IDs have served on the Board for more than 9 years”
Company Independent Director Tenure of IDs (years)
Cummins India Mr. B. H. Reporter 50
Exide Industries Mr. Bhaskar Mitter 46
BASF India Mr. R. A. Shah 44
Zuari Industries Mr. D. B. Engineer 42
HDFC Mr. Keshub Mahindra 35
Colgate Palmolive India Mr. J. K. Setna 34
Tata Steel Mr. Nusli N. Wadia 33
Hindalco Industries Mr. C. M. Maniar 30
Cipla Dr. H.R. Manchanda 29
Ambuja Cements Mr. M. L. Bhakta 27
Titan Industries Mr. T. K. Balaji 26
Audit and Remuneration Committee
24
CG Structure of Top 100 Companies
InGovern recommends AGAINST Adoption of Accounts when Chairman of Audit Committee is not Independent
“Only 45 companies had Audit Committees
comprising only of IDs”
“13 companies have not constituted a Remuneration
Committee”
The average number of audit committeemembers was approximately four.
Only 45 companies had Audit Committeescomprising only of IDs
Companies such as Coal India, Cipla, DLF,Adani Enterprises, Lupin, HPCL, BharatElectronics, Cummins India, etc. haveexecutive directors as part of their Auditcommittee, which is not a good corporategovernance practice.
Clause 49 (Annexure 1D) of the ListingAgreement has a non mandatory requirementfor setting up of a remuneration committeecomprising of at least three directors, all ofwhom should be non-executive directors, theChairman of committee being an independentdirector.
However, as a corporate governance bestpractice, it is recommended that theremuneration committee be comprised only ofindependent directors
25
CG Structure of Top 100 Companies
List Not Exhaustive
Tenure of Audit Firm and Audit Partner
InGovern recommends AGAINST re-appointment of Audit Firm if tenure of Audit Firm >5 years and Audit Partner >3 years
“53 companies have had the same Auditors for >5 years”
Company Auditor Tenure Partner Tenure
Reliance Industries Chaturvedi & Shah 35 D. Chaturvedi 35
Aditya Birla Nuvo Khimji Kunverji & Co >16 Shivji K. Vikamsey 13
Hindalco Industries Singhi & Co 16 Mr. Rajiv Singhi 13
Ashok Leyland M.S. Krishnaswami & Rajan 16 M. K. Rajan 11
Crompton Greaves Sharp & Tannan >16 L Vaidyanathan >9
Sterlite Industries Chaturvedi & Shah 16 R. Koria 6
Tata Power Co. Deloitte Haskins & Sells 16 N. Venkatram 4
DLF Walker, Chandiok & Co 14 David Jones 5
Bajaj Auto Dalal & Shah 13 Mr. Anish P. Amin 12
Remuneration of Auditors
26
CG Structure of Top 100 Companies
InGovern recommends AGAINST re-appointment of Audit Firm if Other Fees* as percentage of Total Fees is very high
List Not Exhaustive
Company AuditorOther Fees as
% of Total Fees
Sterlite Industries Chaturvedi & Shah; Deloitte Haskins & Sells 67%
Ultratech Cement Deloitte Haskins & Sells; G. P. Kapadia & Co 55%
Larsen & Toubro Sharp & Tannan 52%
Sesa Goa Deloitte Haskins & Sells 48%
Tata Consultancy Services Deloitte Haskins & Sells 44%
IDFC Deloitte Haskins & Sells 41%
Mahindra & Mahindra Deloitte Haskins & Sells 40%
Other Observations from CG Perspective
Nominee Directors of Financial Institutions as IDs
Chairman and CEO same
No Chairman
Equal commission to all NEDs
Related Party Transactions
Accounts of Subsidiary/ JV/ Associates consolidated without being audited
Details of components of Audit Fees not disclosed in schedules
No performance criteria or role of Directors mentioned in letter of appointment
No limit on perquisites paid to Directors
Relatives of Promoters appointed as ID (E.g. Shapoor Mistry in Indian Hotels)
27
CG Structure of Top 100 Companies
Contents
28
2012 AGMs –Proposals Analysis
Corporate Governance
Structure of Top 100 Companies
Key Developments for Investor
Protection in 2012
About Us
2012 AGMs – Post Meeting Analysis
New Companies Bill – Key Provisions
Current Voting Practices in India
29
Voting by show of hands. Proxies cannot vote by show of hands. But Proxy can demand a Poll.
Poll allowed if member demands it: (a) 1/10th of total voting power, or
(b) Rs.50,000 of shares
Proxy not allowed to speak in meeting
Member’s resolution: (a) 1/10th of total voting power , or
(b) 100 members and holding paid-up capital of Rs.1,00,000 or more
Notice should be released 21 days prior to meeting date
Post Meeting Analysis
Post Meeting Analysis
30
Post Meeting Analysis
72% of the resolutions proposed in the proxy season were passedunanimously with the remaining passed with requisite majority
Most of the resolutions proposed were passed through show of handswith only two of the resolutions put for voting by poll
In many AGMs, shareholders didn’t ask queries on any resolution
Company Resolution Proposed
Jindal Steel & PowerAppointment of Shri Manohar Lal Gupta as Wholetime Director and
fixing of remuneration
Jindal Steel & Power Revision in the remuneration of Wholetime Directors
Voting by Poll
Withdrawal of Resolutions
31
Post Meeting Analysis
Company Resolutions Withdrawn/Amended
Sterlite Industries (India) Change in place of keeping the registers and records
Dabur India Re-appointment of Director: Mr. Analjit Singh
IFCI Re-appointment of Director: Mr. Prakash P. Mallya
Titan Industries Re-appointment of Director: Mr. R. Poornalingam
Reliance Infrastructure Appointment of Shri C P Jain as a Director
Oil & Natural Gas Corporation Appointment of Mr. Bimal Julka as a Director
Six resolutions were withdrawn/ amended by companies at their annual shareholder meetings
Contents
32
2012 AGMs –Proposals Analysis
Corporate Governance
Structure of Top 100 Companies
Key Developments for Investor
Protection in 2012
About Us
2012 AGMs – Post Meeting Analysis
New Companies Bill – Key Provisions
33
New Companies Bill – Key Provisions
New Companies Bill
Key Provisions Details
Concept of independent
directors introduced
The concept of Independent Director (ID) has been introduced for the first time requiring all listedcompanies and such other public companies as may be prescribed by the Government to appoint IDs.The provisions require companies to at least have 1/3rd of the Board to comprise of IDs. The IDs shall
hold office upto two consecutive terms, each term of upto 5 consecutive years and will be eligible forappointment after cooling period of 3 years. Nominee directors appointed by any institution orGovernment to represent its shareholding shall not be deemed as an ID. IDs will not get stock optionsbut may get payment of fee and commissions subject to limits specified in the Bill/Rules.
Code for Independent Directors
IDs shall abide by a code provided in Schedule IV to the Bill, which lists down guidelines for
important aspects like professional conduct, role and functions, duties, manner of appointment andreappointment, resignation or removal, separate meeting, evaluation mechanism. Important points tobe noted include, appointment of IDs to be independent of management, reappointment to be basedon performance evaluation, holding of at-least one meeting a year without the attendance of non IDs,
performance appraisal to be done by entire board (except the ID being evaluated), etc.
Audit Committee
The Audit committee shall consist of a minimum of three directors with IDs forming a majority,provided that majority of members including its chairperson shall be persons with ability to read andunderstand the financial statements.
Remuneration and Nomination
Committee
Besides the Audit Committee, the constitution of Nomination and Remuneration Committee has alsobeen made mandatory in the case of listed companies and such other class or description of companiesas may be prescribed. The Nomination and Remuneration Committee shall consist of three or morenon-executive director(s) out of which not less than one half shall be IDs.
Stakeholders relationship
committee
Where the combined membership of the shareholders, debenture holders, deposit holders and othersecurity holders is >1,000 at any time during the financial year, the company shall constitute a
Stakeholders’ Relationship Committee. The Chairman of the Committee shall be a non-ED.
34
New Companies Bill – Key Provisions
New Companies Bill
Key Provisions Details
Rotation of Auditors
No listed company shall appoint or re-appoint (a) an individual as auditor for more than one term of 5
consecutive years; and (b) an audit firm as auditor for more than 2 terms of 5 consecutive years. Both,audit firms and individual auditors, shall not be eligible for re-appointment in the same company for 5years from the completion of their term. Further, as on the date of appointment no audit firm havingcommon partners to the other audit firm, whose tenure has expired in a company immediately
preceding the financial year, shall be appointed as auditor of the same company for a period of 5 years.
Exit option to share holders in
case of dissent to change in
object of public issue proceeds
Listed companies which has raised money from public through prospectus and still has any unutilizedamount out of the money so raised shall not change its objects for which it raised the money through
prospectus unless a special resolution is passed by the company. The dissenting shareholders shall begiven an opportunity to exit by the promoters and shareholders having control in accordance withregulations to be specified by SEBI.
Exit option to share holders in
case of Amalgamations
The NCLT Tribunal is being empowered to provide for exit offer to dissenting shareholders in case ofcompromises, arrangements and amalgamations.
Provision for Class Action Suit
Provisions for Class Action Suit have been included with revisions providing for minimum number ofpersons who may apply for such suits. Further, safeguards against misuse of these provisions have alsobeing included.
Constitution of Serious Fraud
Investigation Office (SFIO)
Central Government shall constitute a Serious Fraud Investigation Office (SFIO). It shall also appoint aDirector in the SFIO not below the rank of Joint Secretary and may also appoint such experts and other
officers as it considers necessary for efficient discharge of functions.
Right to Vote by Electronic
Means
The clause provides for members in the prescribed class of companies to exercise the right to vote byelectronic means.
Contents
35
2012 AGMs –Proposals Analysis
Corporate Governance
Structure of Top 100 Companies
Key Developments for Investor
Protection in 2012
About Us
2012 AGMs – Post Meeting Analysis
New Companies Bill – Key Provisions
36
Key Developments for Investors
Key Developments
Key Regulatory Developments in 2012
June 2012: E-voting made compulsoryby SEBI for Postal Ballots for top 500Indian companies
August 2012: Listed companies barredby SEBI from buying shares fromsecondary market through ESOP Trusts/ Employee Welfare Trusts
October 2012: Reforms introduced bySEBI in the IPO market viz. role ofmerchant banker, maximum limit of 25%of IPO proceeds towards generalcorporate purposes, etc
SEBI has decided to form a QualifiedAudit Report Review Committee whichwill scrutinize audit reports of listedcompanies with qualifications foraccounting irregularities
SEBI has proposed to introduce amandatory safety net mechanism forretail shareholders in IPOs in case of dropin share prices by more than 20% in firstthree months of listing of a company
Key Regulations Under Consideration
37
Key Developments for Investors
Key Developments
Shareholder Activism in 2012
February 2012: 23.15% of votes were againstthe merger of 3 Promoter controlled unlistedentities with Akzo Nobel India.
June 2012: >20% shareholders of Sesa Goavoted against the merger of Sesa Goa, Sterlite&other unlisted entities of the Vedanta Group.
June 2012: 60.36% of the non-institutionalshareholders voted against Satyam Computersand Mahindra Satyam merger.
August 2012: Certain shareholders havingaggregate voting rights of >5% in Halonixcomplained to SEBI/ED over its violations ofFEMA and misleading public shareholders
August 2012: UK hedge fund TCI filed a caseagainst Coal India’s Board for its rollback ofprice increase under government’s directives
Jindal Steel & Power: After concerns regardingabsence of certain committees arose, the Boardof the Company voluntarily made somechanges which included change in MD - fromPromoter to a Professional, and setting up aRemuneration & Nomination Committee.
ONGC: The Board of ONGC decided toevaluate performance of its IndependentDirectors
OnMobile Global: Parted ways with itserstwhile Chairman Arvind Rao over certaincorporate governance concerns
Voluntary CG Changes By Indian Cos.
Conclusions
Engagement on Corporate Governance between Institutional Shareholders and Companies is very poor
Routine CG matters are still ignored by companies
Tail Risk remains as CG role of Independent Directors and Investor Engagement isn’t taken seriously
Greater need exist for greater Institutional engagement and activism
38
Q&ATo ask questions, please raise your hand or chat
the question
You can also mail us at [email protected]
Thank YouShriram Subramanian
Founder and Managing Director
InGovern Research Services Pvt. Ltd.
Mobile: +91-9844244411
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