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Chapters 1 GRMCE Short Cuts

By Chirag Chotrani Sir (Yes Academy)


CS Updates Hub | www.CSaspirant.com:



Elements of Corporate Governance - (Bhai) (Bhai) (Bhai) (chirag) (Bhai) (Macha Diye) (Aag) (Laga ke) (Rakh di)

B - Board Appointment

B - Board Skills

B - Board Independence

C - Code if Conduct

B - Board Induction

M - Monitoring Board Performance

A - Audit Committee

L - Legislation

R - RMC


History Development of Corporate Governance in UK


1992 - me khai CADBURY

1995 - Me kaha hogaya hai mota to khaai ‘Greenburry’

1999 - fir b patla nahi hua to logo ne kaha ‘Turnbull’

2020 - UK - Stewardship Code


UK Stewardship Code -

5/3/3/1

Purpose

*P1 - Long Term Value leading to sustainable Benefits for economy/Environment/society

* P2 - Governance to support stewardship

*P3 - Manage Conflict of Interest and put the best Interest of clients

*P4 - Identify and manage Systemic Risk

*P5 - Review The Policy and process to assess the effectiveness


Investment Approach

P6 - Take account of the needs of the clients and communicate outcome of activites


*P7 - Integrate Stewardship and ESG to fulfill responsibilities


P8 - monitor managers and hold them accountable for anything wrong


Engagement

P9 - Engage with Issuers to Enhance Value


P10 - Whenever necessary do collaborative approach


P11 - Escalate stewardship where necessary


Exercise rights and responsibilities

P12 - Actively exercise the rights and responsibilities


CG - Australia

- ASX CG Council forms principles and Recommendations

- These are not mandatory and follows the - ‘If not why not’ approach


- 8 Principles

(Raat ko) (Rajasthan) (Royal) (laga Diya) (Mumbai) (Indians ki) (Sanju) (Samson yaar)


R - Respect the rights of Security Holders

R - Recognise and manage risk

R - Remunerate Fairly

L - Lay solid Foundation for management

M - make timely disclosures

I - Install a culture of acting lawfully

S - Structure the board

S - safeguard the Integrity of Board reports


Singapore - Matlab - Board -

a Effective Board - Responsible for Long Term success

b Appropriate Level of Independence

c division of Responsibility

d transparent process of appointment

e Annual Assessment of Effectiveness as a whole

f Remuneration of Board

g Audit Committee

h Treat All shareholders faily

i Communicates with shareholders


OECD Principles -

Dekho Board ki responsibility hai | To ensure Effective Governance | To Protect the shareholders | Even Institutional Shareholders | Stakeholders ko mat bhulna | Itha kar hi liya hai to disclosure kar do


Corporate Governance in India

1998 (Desirable Corporate governance code)

1999 Kumar Mangalam - Clause 49 was because of them

2002 Naresh Chandra - was formed to review and amend the Auditor -Client Relationship and role of ID

2003 - Narayan Murthy Committee - Revised Clause 49

2004 JJ Irani Committee - proposed revision to CA1956

- Companies Act 2013

- Sebi LODR 2015

- Uday Kotak Committee 2017:

To deal with:

a. Independence of Independent Directors

b. RPT

c. Accounting and Auditing Practices

d. Disclosures and Transparency Issues

The Committee Recommended:

a. Institution of ID

b. Accounting and Audit related Issues

c. procedure for dealing with RPT

d. Composition of Board

e. Board Committees

f. Roles and Responsibility of board

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