Rachana Kokal, a Qualified Company Secretary has over 10 years of experience in adhering to corporate governance norms and is currently employed with Sun Pharma Laboratories Limited.
Ms. Rachana explained the concept of corporate governance and gave day-to-day examples bringing out the importance of CG practices. The case of ICICI Bank – Videocon was discussed wherein she emphasized on misuse of position by the directors, Related Party Transactions [RPT], Performance evaluation of board, Role of independent directors, etc.
She further explained that independent directors must exercise due diligence in case of RPTs. They can demand requisite information from the company to arrive at correct decisions and if they are not satisfied, they can record their dissent. This is crucial as in the unfortunate event of foul play in such RPTs, independent directors can be held accountable.
She then went on to explain that if a company is earning good profits and follows good governance practices, then this leads to building trust in investors and results in gain on the stock prices.