Consentia on Law

CORPORATE GOVERNANCE APPROACH FAVOURABLE TO INDIAN CORPORATE REALITY: (Chalking the Path to a Globally Integrated Approach)

“With rules, one asks, how far are they complied with? With principles, the right question is “How are they applied in practice?”

                                                                                            -Hampel Committee Report[1]

Introduction: Indian Hybrid Approach and its Evolution

Corporate Governance can be defined as the system of rules, practices and processes by which a company is directed and controlled, essentially involving balance of the interests of the stakeholders in a company – these include its shareholders, management, customers, suppliers, financiers, government and the community. Since corporate governance also provides the framework for attaining a company’s objectives, it encompasses practically every sphere of management, from action plans and internal controls to performance measurement and corporate disclosure[2].

The approach to corporate governance varies across jurisdiction. While the U.K and other Commonwealth countries adopt a principle or norm based approach for the enforcement of the provisions of corporate governance codes, in the US, provisions of Sarbanes Oxley and other statutes follow a rule based approach[3]. The merits and demerits of both these extremes have been highly debated. Taking a wiser decision, India seems to have adopted a middle path, encompassing the merits of both the extremes, better known as the hybrid approach wherein those requirements which can be enforced are classified as mandatory and others, which are desirable, are classified as non-mandatory.

The evolution of Corporate Governance spans from the enactment of Companies Act 1956 which provides for certain checks and balances over the powers of Board by way of provisions such as loan to directors or relatives or associated entities under Sec 295, interested contract needs Board resolution and to be entered in register as given in Sec 297, interested directors not to participate or vote according to Sec 300, appointment of director or relatives for office or place of profit needs approval by shareholders if the remuneration exceeds prescribed limit, CG approval required as per Sec 314, mandatory Audit Committee for public companies having paid-up capital of Rs. 5 Crores according to Sec 292A and shareholders holding 10% can appeal to Court in case of oppression or  mismanagement under Sec 397 and 398. Besides these every listed company needs to comply with the provisions of the listing agreement as per Section 21 of Securities Contract Regulations Act, 1956 and non-compliance with the same, would lead to delisting under Section 22A or monetary penalties under Section 23 E of the said Act. With the emergence of best code practices as prescribed by Cadbury and Greensbury Reports, the Kumar Mangalam Committee and subsequently the constitution of Narayana Swamy Committee, to uplift the level of corporate governance, led to the recommendation of Clause 49 of the Listing Agreement which contains both mandatory and non-mandatory requirements. At this stage we see a divergence from the strict rule based approach of the Companies Act 1956 to a flexible norm based approach adopted by way of Clause 49 of the Listing Agreement, ensuring that companies get a free hand in formulating policies and putting in place adoption of best practices. Indian Corporate Governance framework has been in consonance with the revised principles of Corporate Governance (2002) of the OECD which has been hailed as the benchmark for policy makers, investors and stakeholders worldwide[4]. The insights gained from the debacle of Satyam resulted in SEBI taking further policy steps- such as mandatory disclosure of pledged shares held by promoters in listed entities promoted by them, peer review of working papers of auditors of certain listed companies, disclosure of agreement between media houses and listed companies, maintenance of website containing basic information of the companies, compulsory dematerialization of Promoters holdings to increase transparency, peer review of auditors by process of ICAI, approval of appointment of CFO by Audit Committee to ensure sound financial expertise, disclosure of voting results and enabling shareholders to electronically cast their vote to ensure wider participation and a mechanism to process annual audit reports of listed companies- to ensure public dissemination and furtherance of the ends of corporate governance. The Voluntary Guidelines on Corporate Governance 2009 for Indian listed companies specified by the Ministry of Corporate Affairs and constitution of the Adi Godrej Committee in 2012 which enunciated seventeen guiding principles on corporate governance has reflected pursuance of the norm-based approach. Now with the enactment of the Companies Act 2013, the approach has again converged to core governance principles being provided for in the act itself, reflecting the prominence of the rule based approach in Indian corporate reality. The provisions of the Act of 2013 regarding governance are as follows:

  • Requirement to constitute Remuneration and nomination committee and Stakeholders

Grievances Committee and new committees of Board of Directors (Sec 178)

  • Granting more power to the Audit Committee (Sec 177)
  • Mode of appointment of Independent Directors and their tenure (Sec 149, 150)
  • Code of Conduct of Independent Directors (Schedule IV).
  • Requirement to spend on Corporate Social Responsibility (Sec 135).
  • Constitution of National Financial Reporting Authority, an independent body to take action against the Auditors in case of professional misconduct (Sec 132).
  • Specific clause pertaining to duties of directors (Sec 166).
  • Rotation of Auditors and restriction on Auditor’s for providing non-audit services (Sec 139 and 144, respectively).
  • Enhancement of liability of Auditors (Sec 143).
  • Disclosure and approval of Related Part Transactions (Sec 188).
  • Enabling Shareholders Associations/Group of Shareholders for taking class action suits and reimbursement of the expenses out of Investor Education and Protection Fund (Sec 245)[5].

Through legislations which provide for governance and constitution of committees which submit dynamic reports on emerging principles of good corporate governance, and a healthy combination of voluntary practices and mandatory requirements, the Indian corporate reality seems to have chalked a hybrid, middle-path or balancing approach which has consolidated on both the extremes- the norm based as well as the rule based approach.

Governance Approach of Varying Jurisdictions

In the global securities marketplace and companies, restoring faith in governance by investors has become a time-sensitive, crucial initiative to ensure capital still flows into the trading arena; that stock prices are buttressed; and that investors will be able to accurately assess the value and potential of companies and/or funds. The approaches followed by varying jurisdictions are as follows:

  • In the USA, the Sarbanes-Oxley Act was introduced into legislation by The House of Representatives and then the Senate who were concerned about the fact that CEO’s, CFO’s and Boards must be expressly accountable for the Financial Statements and Management Estimates published by their companies. This act is a specific rule based approach and a requirement by all corporations operating in the USA. It confers special responsibility and expectations on Public Accounting Firms and Auditors, the Securities Exchange Commission, and State Legislatures to police the Act.
  • Recently the US Securities and Exchange Commission (SEC) approved new Governance rules outlined by the NYSE and NASDAQ, for companies listed on their exchanges. Those who fail to comply by November 2004, risk being de-listed.
  • In Canada, the TSE refused to enunciate hard and fast rules, preferring instead to outline Guidelines, then rely on shareholders to hold their Boards accountable for operating in relation to the guidelines. The Ontario Securities Commission published its proposals for best practices in governance, and requiring all Issuers to make regular disclosure about their practices against such best practices. The OSC has thus moved towards a quasi-rules based environment.
  • In the UK, the Cadbury Commission of the London Stock Exchange released their Combined Code of Governance Principles and Best Practices. The suggestion being that companies self-report to the investment community against these standards as their approach to restoring trust in their market.
  • The Hong Kong Laws regarding good governance were published as a “Code of Best Practices”. These explicitly state that they are not intended as rules to be rigidly adhered to, but should rather serve as guidelines that companies should aim for.
  • The German Panel on Corporate Governance essentially embraced the OECD’s Principles of Governance and recommended transparency approaches to information and disclosure practices by German listed companies[6].

Most jurisdictions around the world favour the use of principles and norms and extend a belief and trust in their organizations to subscribe to such principles. Such faith also leaves the vigilance of good practice to the larger community, and leaves unclear the specific consequences. However, one assumes that public exposure of practices not in keeping with the principles will result in significant loss of face and credibility. In the US, there is a tendency not to extend such trust, and instead to develop and insist on compliance to a specific set of rules. In such a system the consequences of non-compliance are clear, and supposedly swift, yet restricted to the jurisdiction of the regulatory body.

 

Rule based Approach and Norm based Approach: Merits and Challenges

Rule based approach requires companies to exhibit minimum standards of practice. In order to gain approval by a majority of members, the standards have to be essentially the minimally acceptable practices. Hence, the rule based approach ensures that companies at least adhere to a minimum standard of corporate governance. The implication of this approach is that it can set the bar of corporate governance quite low, resulting in less than excellent standards. Companies in such a case will never aspire to set the benchmark of corporate governance by revising their policies till it improves to near perfection. Instead companies shall be given a pass ticket for complying only with the minimum standards which will never lead to formulation of better policies. Also, the rigidity offered by the rule based approach can cause inconvenience to companies, not giving them a free and flexible hand to manage their own affairs. It can lead to unnecessary expenses and wastage of precious time[7].

However, looking over the challenges, the merits of this approach are obvious. Rules such as those in the Sarbanes-Oxley Act have significantly improved corporate governance and executive staff reporting to the Board. It has also significantly eliminated any suspected collusion between auditors, bankers, and corporate officers as that which is under investigation in the Enron case. The Companies Act 1956 and the mandatory requirements of Clause 49 of the Listing Agreement have ensured that the basic concepts and principles of corporate governance are compulsorily adhered to, to set a minimum standard of good governance and weed out frauds and scams. The governance provisions of Companies Act 2013 shall now further the standards of good governance in Indian companies.

Unfortunately, a rules-based approach also tends to encourage those to play games with the rules, to find loopholes in the rules, and to find ways around the rules. During trying times of financial crisis, the temptation to deviate is stronger and according to industrialist Adi Godrej “the need of the hour is concentration on principle-based rather than rule-based corporate governance. Principle-based corporate governance offers corporates the much-needed competitive advantage in markets, easy availability of capital, enhanced employee morale and stakeholder confidence; and long-term sustainability”[8]. This view discusses that importance should not be given to formulation of new rules but effective enforcement of the existing ones and enhanced attention to principles of corporate governance[9].

However, dismissing the rule based approach would be a hasty and unwise step. The rules-based approach can help ‘snap’ the members of a certain community into action in a very short period of time, and hope to ensure a minimum new standard of practice, that will rapidly increase trust in their system.

Speaking of the merits of the principles or norm based approach; principles essentially have no minimum standard of practice and can rise over time. Principles work to influence a broad set of practices conforming to a level of expectation by the stakeholders. The implication being, that if any of the stakeholders believes the practices of a company to be skirting the issue, or non-genuine, then the problem of confidence in the actions of the company occurs. This then should leverage companies to a high standard of practice, as minimal compliance will not really be tolerated by most onlookers. Principles also encourage organizations to start right away at moving their current practices in-line with the principles, leaving room for continuous improvement over time. At the same time, companies are given a free hand over the conduct of their affairs and flexibility to manage their affairs in tandem with high standards of governance. Unfortunately, principles do not explicitly require certain practices to be mandatorily followed. So while giving a chance to companies to aspire for higher standards of governances, principles fail to keep a check on adherence to basic necessary standards. As such, it is hard for principles to get everyone moving into new practices in a particular timeframe. By leaving the onus on investors, or donors, or community members (in other words stakeholders), to measure adherence to principles, it also leaves to these parties the responsibility to demand public reporting/ communication. This then eventually plays out by giving the media or special interest groups the responsibility to ‘police’ the practices of companies, which can be manipulated by companies[10]. In India, the adherence to the non-mandatory requirements of Clause 49 of the Listing Agreement and recommendations of various Committees (Godrej, Mangalam, and Swamy) is in question. This non adherence can cause major problems such as incompetent non-executive directors, victimization of whistleblowers in absence of a whistle blowing policy, manipulations regarding remuneration of executive directors in absence of remuneration committee and outdated knowledge and skill of directors in absence of training programs to upgrade their knowledge pool, which will all in turn harm the performance and efficient running of the company. While some companies may follow it, most leave it out of their corporate governance policies to save expenses, time and effort, resulting in challenges in the face of the norm based approach. By not ensuring a basic (minimum) standard, i.e. a solid foundation, the norm based approach fails to take off on its wings to higher standards of corporate governance.

 

Hybrid Approach: Why it is Favourable in the Indian Scenario?

To ensure good governance a balance between the two warring approaches- rule based and norm based- needs to be struck in order to churn out the merits of both. Any code of Corporate Governance must be dynamic, evolving and should change with changing context and times. It is felt that rule based approach alone may not serve the purpose of improving the Corporate Governance of listed companies. A hybrid approach, wherein the broad principles are laid down to give broad direction to the companies on Corporate Governance and what is expected of them followed by rules to mandate compliance with specific aspects of Corporate Governance would be considered as the most effective mechanism for improving Corporate Governance in the Indian scenario according to SEBI[11]. In consonance with this view, the present hybrid or middle path approach followed in India is suitable for the present corporate context, because India is at a cross roads of development. While a few companies have grown in colossal proportions, most companies remain small/medium entities with limited capital. To balance the interests of both, the hybrid approach is befitting, as both shall be able to aspire for higher standards of governance, while the mandatory minimum standards are complied with to ensure that no inconvenience is caused to small companies in terms of expenses, time and effort, while the aspirations of small, medium and larger companies to set a benchmark of corporate governance are not clipped. The hybrid approach also provides the requisites of rigidity and flexibility to companies, thereby ensuring that companies are given a free hand in managing their affairs and formulating policies suitable to their business model while not being overly free to completely ignore important aspects of corporate governance. This delicate balancing act is enabled by the governance provisions of the Companies Act 1956, to be furthered by the governance provisions of Companies Act 2013 and mandatory requirements of Clause 49 of the Listing agreement (as explained in the introductory part of the article) which need to be compulsorily complied with by companies and the non-mandatory requirements of Clause 49 of the Listing Agreement, the Voluntary Guidelines on Corporate Governance 2009 and the recommendations of the Mangalam, Swamy and Godrej Committee which provide a platform for setting higher standards of corporate governance.

While the approach befitting the Indian corporate reality has been discussed, attention needs to be given to the model of corporate governance followed by Malaysia which is in similar lines to that of India. The Malaysian Institute of Corporate Governance (MICG) has introduced the Malaysian Code on Corporate Governance (revised in 2007) approved by the Finance Committee on Corporate Governance of the Government of Malaysia[12]. The Code aims to set out principles and best practices on structures and processes that companies may use in their operations towards achieving optimal governance framework. There are three broad approaches to the issue of corporate governance now in practice around the world:

  • Prescriptive (desirable standard practices are specified, compliance disclosed)
  • Non-prescriptive (disclosure on actual practices, no specified standard) and
  • Hybrid approach (blend of the above two, with mutual accommodation)[13].

The Malaysian Code on Corporate Governance adopted a hybrid approach. This suggests that the company must have some indigenous standards and practices depending on its nature of business and needs and non-specific standards in which the company may have a free hand to formulate policies and implement change in order to aspire for higher standards of governance.

The hybrid approach allows for a more constructive and flexible response to raise standards in corporate governance as opposed to the more black and white response engendered by statute or regulation. It is in recognition of the fact that there are aspects of corporate governance where statutory regulation is necessary and others where self-regulation complemented by market regulation is more appropriate. The hybrid approach followed by both India and Malaysia is in consonance with the Hampel Committee Report[14]. This is the approach preferred by the Hampel Committee. The Committee considered that there is a need for broad principles and that all concerned should then apply these flexibly and with common sense to the varying circumstances of individual companies. Good corporate governance is not just a matter of prescribing particular corporate structures and complying with a number of hard and fast rules. The need for a hybrid approach also results from economic forces and the need to reinvent the corporate enterprise, so as to efficiently meet emerging global competition. The world’s economies are tending towards market orientation. In market-oriented economies, companies are less protected by traditional and prescriptive legal rules and regulations[15]. Malaysia and India which are developing countries expecting to face tough economic and industrial competition are no exceptions. Hence there is the need for companies of developing countries to be more efficient and well-managed than ever before to meet existing and anticipated world-wide competition.

The hybrid approach favours the Indian corporate reality due to the following reasons:

  • The balance of both rules and principles of corporate governance.
  • To go to the extreme of merely requiring disclosure of existing corporate governance practices of Indian companies is not sufficient.
  • Each company should have the flexibility to develop its own approach to corporate governance and not compelled to adhere to the principles strictly.
  • Companies are given a free hand to develop alternatives that may be just as sound as voluntary principles of corporate governance.
  • The rules and regulations set the standard that companies must measure up to at all cost.
  • The principles are accompanied by rules requiring disclosure of the extent to which listed companies have complied with the principles and where they have not, the reasons why.
  • The merits of the both the extremes- rule based and norm based, are amalgamated.
  • Prevent a ticking boxes approach so that companies (directors) concentrate on exercising their judgement rather than on mere form with respect to what corporate governance practices are best for their business model, ensuring diligent pursuance of corporate governance objectives than merely indicating that the rules have been complied with (“box ticking” is neither fair to companies, nor likely to be efficient in preventing abuse).
  • Prevent possibility of the next disaster like Satyam to emerge in a company which, on paper, has a 100% record of compliance.
  • Further the true safeguard for good corporate governance, which lies in the application of informed and independent judgement by experienced and qualified individuals – executive and non-executive directors, shareholders and auditors.
  • Augment competition in the international market. The hybrid approach offers the right amount of rules and norms to companies of developing countries to be able to circumvent frauds and scams and emerge above par with respect to companies of developed countries in terms of corporate governance and performance.
  • Secure sufficient disclosure by way of rules and norms so that investors and others can assess the company’s performance and governance practices, and can respond in an informed way.

In light of the discussion and descriptions enunciated in this article as well as the explanation as to why the hybrid approach is best for companies of developing countries, especially how the hybrid approach favours the Indian corporate reality, it is safe to assume that the need of the hour in India is to continue with the current hybrid approach with special focus on effective enforcement of the rules and regulations in place (the provisions of Companies Act 1956, the provisions of Companies Act 2013 and the mandatory provisions of Clause 49 of the Listing Agreement[16]) and enhancement of the dynamism of voluntary guidelines and norms keeping pace with changing economic times.

 

Globally Integrated Approach for MNCs: Organizational Social Responsibility Model and Globally Integrated Enterprises Model

Good Governance practice has been further augmented in the recent years by rise in importance of Corporate Social Responsibility. This is based on an understanding of the expectations that our communities have regarding the ‘social contract’ that companies enter into with their stakeholders. “This may include public reporting, openness to input, access points for complaints about services or tips regarding illegal actions of employees. It may also include the concept of an Ombudsman to address community and/or employee and/or contractor issues with regard to the functioning of a company. Being, and being seen to be, a good ‘corporate citizen’ by members and stakeholders now lifts the standards of governance into a whole different realm. No longer can Governors or Board members be content to live by rules, or adapt processes to exemplify principled practices. Instead the company’s senior leaders must commit to be in tune with, proactively communicating, listening to, and actively accessible/accountable towards their community of citizens and stakeholders. This is a philosophy that transcends an inside view, and instead recognizes the bigger Stewardship role companies have. Providing a vehicle for open access, suggestions and tips is one such mechanism companies can use to advance towards this Social Responsibility role”[17].

This approach however, looking at current corporate reality is too heavy handed and abstract to effectively prove to be the best approach for a globally integrated model. Also, it screams of a lack of effective enforcement and fails to offer checks on companies. This approach can be summoned at a later stage when financial turbulence and scandals are dealt with appropriately and investors trust has been regained to a greater extent.

More realistically, the approach followed by IBM (an MNC), to address economic changes of the 1990s, seems to have made an impact on the governance of MNCs. “In the twentieth century, especially after the Second World War, a business model evolved. In this model, global companies often replicated their operations in each country where they did business. This was the ‘multinational’ model, where each country organization had its own management, its own sales and service teams, its own product line, its own supply chain and often its own manufacturing and research and development and therefore, its own set of corporate governance aspects which were a healthy mix of rules and norms in accordance with the national laws of the country where business was conducted and adherence to the voluntary norms prescribed in such countries”[18].

But this model has been deemed redundant because of globalization, “redundant because no company can afford to duplicate the very same business processes in each country, when it would be much more effective in a connected world to put every process in one or two or three locations, and serve the entire globe from those locations. And uncompetitive because with the world linked as it is, if companies do not draw on the skills available at competitive prices wherever that expertise exists, then some other companies/entities will do it, and put the companies out of business”[19].

To solve this predicament IBM has come up with a globally integrated enterprises (GIE) model, a term coined by IBM CEO and President Sam Palmisano[20]. As business operations become more globally integrated, managing accountability requirements becomes more complex. On the one hand governments remain the most significant point of accountability, influencing business success through legal, regulatory, fiscal and social policy frameworks that are country based. Alongside these national requirements, other stakeholders including customers, NGOs and communities are increasingly global, and frame accountability around global standards. In the globally integrated enterprise model accountability is managed by globally integrated support functions with specialists in the various interest areas. Resources are deployed where they are needed. This model enables the company to develop standards that reflect global interests, and to operate systems across the entire company. This is important for building trust. The focus is on establishing sustained relationships with key stakeholders to understand and influence their requirements. In the GIE model, the country General Manager remains pivotal to key relationships. But alongside them we see an increasing need for a wider group of leaders to engage with external institutions and organizations and integrate their perspectives into doing business. Starting with the international level first, as the globally integrated enterprise is by definition focused on its environment from a global perspective, companies (leaders) have no option but to engage in governance issues in a global way. They can no longer fall back on the sense of national citizenship and national issue management that they had when companies operated primarily as ‘multinationals.’ Business success on a global stage now depends on how well a company can anticipate and engage those governance issues, not only as a demonstration of citizenship or philanthropy, but as a fundamental means of creating long term economic value[21].

This model can be implemented in reality, based on agreements signed between multinational companies (MNCs) and unions or organizations of countries under the jurisdiction of which these MNCs operate. Hence, MNCs with centralized locations in Asian Countries can enter into a corporate governance agreement with SAARC/ ASEAN (South Asian Association of Regional Corporation/ Association of Southeast Asian Nations) which shall implicate that SAARC/ASEAN will enforce rules and regulations of corporate governance with respect to such MNCs, while making recommendations and revisions from time to time to keep pace with changing business environment. Similarly, MNCs with centralized locations in European countries can enter into corporate governance agreements with the European Union, which would implement and enforce important aspects of governance in such MNCs. The MNCs with centralized locations in the US can enter into agreements with the WTO (World Trade Organization) which would oversee corporate governance issues regarding such MNCs. This kind of a globally integrated approach can ensure that companies are kept a check on at the international level, resulting in increased transparency of affairs and transactions and quick detection of any wrongdoing. Such agreements will also ensure that MNCs when brought at a common platform emulate the best practices followed by each other according to their business model and compete in a healthy manner for setting high the benchmark of good governance. It can also help reduce protectionist trends of countries during times of economic crisis as MNCs require access to global markets for growth, making them inter-dependent which will ensure that MNCs keep a check on governance practices of each other, in turn ensuring that their counterparts don’t go bust or fail. Moreover, this approach can bring more foreign investment, establishment of governance institutions, etc, in developing countries as self-interested MNCs try to tap the growing potential of these markets. Collaboration (think tanks and global outlook discussions) among MNCs can also help solve the problem of ageing workforce (in European countries) and surplus young workforce (in Asian countries) by appropriate exchange programs for workforce.

Governance as far as it affects the relationship between an MNC and its own employees; it is believed the globally integrated enterprise model calls for a re-definition of the relationship between a company and its employees. An example of this is when IBM introduced in July 2007 a major initiative called the global citizenship portfolio, to give employees more tools to maintain their own competitiveness, and direct their own lives, in a globalized world[22].

For the globally integrated model to flourish, the key important point is trust. Trust is the foundation for all the issues of governance whether it be self regulation or following of norms/principles or leadership education or multi-stakeholder partnerships. Trust between employees and the company they work for, trust between companies and national governments, trust amongst every stakeholder and the company will encourage the economic life of the planet.

For the future of enhanced business, MNCs need to collaborate with each other, national governments and world bodies, which should be initiated by the MNCs on their own (as effectiveness of legal action against MNCs has been hindered by limitations in international law and the lack of a binding international legal framework to govern the behaviour of transnational corporations makes prosecuting MNCs become a question of jurisdiction) by drafting corporate governance agreements, setting up think tanks and governance outlook discussions with scholars, business leaders and politicians, in a more open manner that will regain the trust needed for good global governance.


[1] Hampel Committee, Final Report (January 1998), available at: http://www.ecgi.org/codes/documents/hampel_index.htm, (Visited on 20th September 2013).

[2] Definition of Corporate Governance, available at: http://www.investopedia.com/terms/c/corporategovernance.asp, (Visited on 19th September 2013).

[3] SEBI Consultative Paper on Review of Corporate Governance Norms in India 2009, p. 2-15, available at: http://www.sebi.gov.in/cms/sebi_data/attachdocs/1357290354602.pdf, (Visited on 19th September 2013).

[4] ibid

[5] Aish M. Ghrana, “Corporate Governance: Regulatory Frameworks Under Consideration”, available at: http://aishmghrana.me/2013/01/11/corporate-governance-regulatory-frameworks-under-consideration/, (Visited on 19th September 2013).

[6]Banff Executive Leadership Inc, , “Improving Governance Performance Rule Based vs. Principle Based Approach”, available at: http://www.banffexeclead.com/AcumenPDF/Governance%20Articles/Leadership%20Acumen%2016%20V10%20Governance%20Principles%20vs%20Rules.pdf, (Visited on 18th September 2013).

[7] ibid

[8] Umakanth Varottil, “India’s Corporate Governance Voluntary Guidelines: Rhetoric or Reality”, available at: http://www.manupatra.co.in/newsline/articles/Upload/01DB3BD0-E7A8-4EF4-9807-FDF0D29C3B9E.pdf, (Visited on 16th September 2013).

[9] Corporate Bureau, “India Inc told to go by Principles, not the Rulebook, on Governance”, The Financial Express, 19th December 2008.

[10]Banff Executive Leadership Inc, “Improving Governance Performance Rule Based vs. Principle Based Approach”, available at: http://www.banffexeclead.com/AcumenPDF/Governance%20Articles/Leadership%20Acumen%2016%20V10%20Governance%20Principles%20vs%20Rules.pdf, (Visited on 18th September 2013).

 

[11] SEBI Consultative Paper on Review of Corporate Governance Norms in India 2009, p. 9, available at:  http://www.sebi.gov.in/cms/sebi_data/attachdocs/1357290354602.pdf, (Visited on 19th September 2013).

[12] Malaysian Code on Corporate Governance (Revised 2007), available at:  http://www.sc.com.my/eng/html/cg/cg2007.pdf, (Visited on 20th September 2013).

[13] ibid

[14] Hampel Committee, Final Report (January 1998), available at: http://www.ecgi.org/codes/documents/hampel_index.htm, (Visited on 20th September 2013).

[15] ibid

[16] Ms. Hiral Mehta, Class Lectures for Semester VII (Company Law II), NUSRL, Ranchi

[17]Banff Executive Leadership Inc, “Improving Governance Performance Rule Based vs. Principle Based Approach”, available at: http://www.banffexeclead.com/AcumenPDF/Governance%20Articles/Leadership%20Acumen%2016%20V10%20Governance%20Principles%20vs%20Rules.pdf, (Visited on 18th September 2013).

[18] Hans Ulrich Maerki, “The Globally Integrated Approach and its Role in Global Governance”, available at: http://www.eabis.org/uploads/media/Maerki_global-integrated-enterprise.pdf, (Visited on 15th September 2013)

[19] Douglas Gregory, “Trade, Innovation and The Globally Integrated Enterprise”, available at: http://www.oecd.org/site/tadtig/39519771.pdf, (Visited on 20th September 2013).

[20] IBM Icon of Progress, “The Globally Integrated Enterprise”, available at: http://www-03.ibm.com/ibm/history/ibm100/us/en/icons/globalbiz/transform/, (Visited on 20th September 2013).

[21] ibid

[22]Jeanette Horan and Dusty Rhodes, “IBM’s Transformation to a Globally Integrated Enterprise”, available at: http://www.sap.com/community/webcast/2008_05_SAPPHIRE_US/2008_05_SAPPHIRE_US_OR4273.pdf, (Visited on 20th September 2013).

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