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Journalism of Courage
The Sebi has initiated adjudication proceedings against 20 listed companies for their failure in complying with Clause 49 of the listing agreement. “Clause 49 deals with corporate governance by companies listed on the exchanges. Based on the quarterly reports from the stock exchanges, Sebi has initiated adjudication proceedings against a total of 20 companies from the private sector and the public sector,” it said.
Of these 20, five firms belong to the public sector against whom proceedings have been launched for non-compliance with provisions relating to board composition. The remaining 15 companies are in the private sector. Sebi, however, did not reveal the names of the companies.
Under this rule, which came into effect from January 1, 2006, companies need to have 50 per cent independent directors on their board, if they have an executive chairman. If companies have a non-executive chairman, the number of independent directors can be lower at one-third.
