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CORPORATE GOVERNANCE

September 15, 2011. Coal India Limited. CORPORATE GOVERNANCE. 1. September 15, 2011. Companies need to ensure code of conduct for all managers , long – term strategic plans , CSR initiatives, submission of regular and accurate financial statements,

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CORPORATE GOVERNANCE

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  1. September 15, 2011 Coal India Limited CORPORATE GOVERNANCE 1

  2. September 15, 2011 Companies need to ensure • code of conduct for all managers , • long – term strategic plans , • CSR initiatives, • submission of regular and accurate financial statements, • providing of regular information about financial position of the company to the shareholders , • evaluation by the board of its performance, • independent Audit Committees and • effective risk management plans. Coal India Limited 2

  3. September 15, 2011 CORPORATE GOVERNANCE IN PSE’S • PSE’s today play a significant role in accelerating the economic as well as social development of the country . • This can be facilitated by following sound ,prudent and transparent business principles and practices . • They are guardian or trustees of precious public money . • They deal with tax payers money and are therefore accountable to Parliament. Under such circumstances , there is a need for a strong vigilance organization in the PSE’s with a set of rules / code of conduct to guide the actions and conduct of these Enterprises. Coal India Limited 3

  4. September 15, 2011 • And as required Corporate Governance in PSE’s is more robust than that in most private counterparts . • Apart from the Parliament ,PSEs are accountable to other authorities under several regulations like • the Comptroller and Auditor General of India (CAG) , • Central Vigilance Commission (CVC), • three layers of audit control (Statutory Audit, Internal Audit and CAG) and • the Rights to Information Act (RtI) Coal India Limited 4

  5. September 15, 2011 • This was evidently apparent during the recent economic turmoil in private companies when investors fled to public enterprise stocks due to • much better confidence of stakeholders in PSE management . • PSEs are open and transparent ensuring fairness in their transactions within and outside the Company with investors , customers ,employees ,partners , competitors and society at large. Coal India Limited 5

  6. September 15, 2011 CORPORATE GOVERNANCE IN ONGC Mr. R.S .Sharma , CMD , ONGC says – Corporate Governance in ONGC is led by • strong emphasis on human values , • individual dignity and adherence to honest , ethical and professional conduct . • The endeavors in this regard are focused on highest level of transparency ,openness and accountability and fairness in all areas of operation ,meeting the aspirations of all its stakeholders . Coal India Limited 6

  7. September 15, 2011 Mr. Arup Roy Choudhury ,CMD,NTPC says – As a good Corporate citizen , the company is committed to • sound corporate practices based on conscience , openness, fairness ,professionalism and • accountability in building confidence of its various stakeholders in it thereby paving the way for its long term success. • NTPC is always on forefront in adopting and implementing sound governance norms. Coal India Limited 7

  8. September 15, 2011 Mr. Chandra Shekar Verma , Chairman , SAIL says – SAIL is committed to • practice the highest standard of corporate governance by ensuring transparency , disclosures and reporting that conforms fully with laws ,regulations and guidelines . • promotes ethical conduct throughout the organization , with the primary objective of enhancing shareholders value , while being a responsible corporate citizen. • The Company recognizes that the Board of Directors is accountable to all shareholders and that each member of the board owes his first duty for protecting and furthering the interests of the Company. Coal India Limited 8

  9. September 15, 2011 Mr. B. Prasada Rao, CMD , BHEL says – BHELs Corporate Governance policy is based on the following principles: • Independence and versatility of the Board • Integrity and ethical behavior of all personnel • Recognition of obligations towards all stakeholders –shareholders, customers,employees,suppliers and the society at large. Coal India Limited 9

  10. September 15, 2011 • Shri N.R. Narayana Murthy, Chief Mentor, Infosys Limited. • Corporate governance is maximizing the shareholder value in a corporation • ensuring fairness to all stakeholders, customers, employees, investors, vendors, the government and the society-at-large. • transparency and raising the trust and confidence of stakeholders in the way the company is run. • owners and the managers operating as the trustees on behalf of every shareholder - large or small." - Coal India Limited 10

  11. September 15, 2011 • With the goal of promoting better corporate governance practices in India, the Ministry of Corporate Affairs, Government of India, on 1st October 2003 set up : National Foundation for Corporate Governance (NFCG) • in partnership with Confederation of Indian Industry (CII), • Institute of Company Secretaries of India (ICSI) and • Institute of Chartered Accountants of India (ICAI). • In the year 2010, stakeholders in NFCG has been expanded with the inclusion of ICWAI and the National Stock Exchange. Coal India Limited 11

  12. September 15, 2011 CORPORATE GOVERNANCE • CG is the system by which companies are directed and controlled by management in the best interest of shareholders and others. • The BOD are responsible for governance of their companies • A number of reports and codes of CG has been published internationally • SEBI also has recently introduced a new clause (i.e. clause 49 ) in the listing agreement entered between a stock exchange and a company who desires to list its securities on stock exchange. Coal India Limited 12

  13. September 15, 2011 • As per this clause, if a company desires to list its securities on a stock exchange, then it has to agree and implement the code of corporate governance • The company is also required to obtain a certificate from the auditor/practicing company secretary as regard compliance of the conditions of CG as given in this clause. • The various items of this clause are: • Composition of board • Setting up of audit committee • Remuneration of directors • Meeting of BOD etc. Coal India Limited 13

  14. CONTENTS OF CLAUSE 49 OF LISTING AGREEMENT (CG) September 15, 2011 Coal India Limited 14

  15. INDEPENDENT DIRECTOR September 15, 2011 Coal India Limited 15

  16. September 15, 2011 Coal India Limited 16

  17. AUDIT COMMITTEE September 15, 2011 Coal India Limited 17

  18. September 15, 2011 Coal India Limited 18

  19. REMUNERATION OF DIRECTORS September 15, 2011 Coal India Limited 19

  20. BOARD PROCEDURES September 15, 2011 Coal India Limited 20

  21. REGARDING SHAREHOLDER September 15, 2011 Coal India Limited 21

  22. SUBSIDIARY COMPANY September 15, 2011 Coal India Limited 22

  23. September 15, 2011 CEO/CFO CERTIFICATION Coal India Limited 23

  24. September 15, 2011 Coal India Limited 24

  25. September 15, 2011 Coal India Limited 25

  26. September 15, 2011 Coal India Limited THANK YOU 26

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