MUMBAI, JAN 5: The Securities and Exchange Board of India has extended the deadline for the first set of companies to comply with the corporate governance code to March 31, 2001 from April 2000.The committee on corporate governance headed by industrialist Kumar Mangalam Birla, met on Wednesday, gave the finishing touches to the draft report, which will be formally ratified by the Sebi board in the next two days. The panel has stuck to its recommendation that financial institutions (FIs) should have a presence on the board of a corporate only in the event of default on loan terms.Sebi said the decision to extend the compliance deadline was taken as it would take the companies three to six months to restructure their boards in accordance with the guidelines. Elaborating on the final draft, a Sebi official said that new listings - that is companies which are seeking listing on the stock exchanges for the first time - should comply with the code.Companies which have to comply by March 31, 2001, are thoselisted under Group A category in the BSE and those constituting the S&P and Nifty indices. These companies would account for 80 per cent to 85 per cent of the total market capitalisation and would represent all the most actively traded shares with bulk of the investor interest. The second group of companies comprising those with a paid-up share capital of Rs 10 crore or networth of Rs 25 crore will have to comply with the code by March 31, 2002. This will bring around 95 per cent of the companies under the fold. The third category of companies, where the paid-up capital is between Rs 3 crore and Rs 10 crore will have to show compliance by March 31, 2003.Sebi said that the idea was to initially account for the larger companies, which have a substantial impact on investor preferences.
