Highlights 3 Rs of Corporate Governance: ‘Robust’ ‘Responsible’ ‘Relevant’
Corporate Governance should not be seen as imposed rules, but should come from within organizations
In an intellectually charged breakfast session, Ms. Chanda Kochhar, MD & CEO, ICICI Bank Limited spelled out the 3 Rs of Corporate Governance namely ‘Robust, ‘Responsible’ and ‘Relevant.’ “From a practitioner’s point of view, for me the entire concept of Corporate Governance goes beyond rules of how boards or organisations function in terms of processes and rules. Today it is about the wider response to society, consumers, environment, employees, regulators, government and stakeholders and about creating culture within the organisation to meet those responsibilities,” Ms. Kochhar said. She was addressing the CII Governance Series 2015-16 - a series of breakfast sessions launched by Confederation of Indian Industry (CII) with a view to discuss the latest on corporate governance and concerning issues.
Explaining different perspectives of looking at Corporate Governance, she said these are practices to be followed over and above the rules and prescriptions - not because it is imposed but because it adds value to management, stakeholders and society at large.
Outlining constituents of corporate governance, she said that the first responsibility for corporate governance lies with the Board of Directors – made more robust, wider, broad and comprehensive against the backdrop of the new Companies Act. Next in line is society – since businesses not only have to be socially responsible, but they have to ensure that they do not cause society harm. This would be followed by responsibility towards the environment and climate change. Adding to the general definition of corporate governance, she spoke about the need for healthy workplace practices; gender diversity etc while highlighting the complex role of the HR.
She enumerated further by talking about the responsible use of technology while controlling risks like cyber security. Expanding the scope of Corporate Governance, Ms Kochhar coined ‘compliance with conscience’ describing creating a culture of transparency and responsibility towards organisational culture. She also highlighted the importance of digitisation, social media and mobilization to meet the demands of today’s youth.
Setting the tone at the session, Mr Jim Smith, President and CEO, Thomson Reuters spoke about how the culture of strong corporate governance is essential to meeting increasingly complex global regulatory standards and maintaining the confidence of the global investment and stakeholder community. He asserted how technology is enabling more transparency and consistency within governance processes, contributing to better performance.
Earlier, delivering the welcome remarks, Mr Nimesh Kampani, Chairman, JM Financial Group called Corporate governance a tool for value creation. He explained that while everyone perceives value differently, corporates need to ensure that all stakeholders – whether direct or indirectly shall benefit from it.
9th December 2015