Independent directors of Reliance Energy get wider roles

Dr Leena Srivastava of Teri will become REL’s lead independent director who will now preside over all executive sessions of the board’s independent directors, the company said in its annual communication to shareholders.

This comes at a time when three other independent directors, Prof J. Ramachandran, Reliance Industries’ representative Amitabh Jhunjhunwala and lawyer Cyril S. Shroff quit the company’s board in fiscal 2005.

The independent directors, which now includes retired Gen V.P. Malik, economist S.L. Rao, chartered accountant Gautam Doshi, LIC representative V. R. Galkar and Srivastava will also meet without presence of any representative from the REL management to discuss the performance and compensation, strategic issues for rest of the board’s consideration, and future board agendas.

It will also look at the flow of information to directors, management’s progression and succession and corporate governance guidelines.

According to REL, Srivastava as lead independent director will work closely with Anil Ambani to finalise the information flow, finalise board’s agenda and meeting schedules. She will also liaise between Anil and other independent directors and take a lead role in board evaluation process.

The electricity firm — owned 50.15 per cent by RIL — has also set up a risk management committee consisting of executives and Gen Malik to review the risk management procedure to ensure that REL controls risks through means of properly-defined framework.

The board has also decided to fix the dates of board meetings one year in advance so that so that directors to plan their commitments and facilitates attendance of all directors at the meetings of the board and its committees. Anil Ambani, the company adds, will also meet all the independent directors regularly so that issue of business and management can be discussed freely without any encumbrances.

Whistleblower policy

Reliance Energy has also formulated a policy to prohibit managerial personnel from taking any adverse personnel action against employees disclosing alleged wrongful conduct on matters of public concern involving violation of any law, mismanagement, gross waste or misappropriation of public funds, substantial and specific danger to public health and safety or an abuse of authority. Employees are now encouraged to make disclosures directly to the company’s audit committee which is chaired by independent director Gautam Doshi.