Corporate Governance Charter for Start-Ups released by Confederation of Indian Industry (CII) | Current Affairs | Vision IAS
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Corporate Governance Charter for Start-Ups released by Confederation of Indian Industry (CII)

Posted 29 Apr 2024

2 min read

  • Corporate Governance is a dynamic set of value driven principles and measures which steers an organization’s development in the right direction.
    • It is based on the principles like Transparency, Fairness, Accountability etc. 
  • The charter has been released in the backdrop of significant erosion in shareholders’ value in Indian Startups due to governance failure in many high-profile Start-ups in the recent time.
    • E.g. BharatPe, GoMechanic etc. 

 

  • Key Highlights of the Charter
    • Objective: It will serve as a self-governing code for Startups (incorporated under the Companies Act, 2013). 
      •  It will help start-ups in not only adding value but also in achieving stability, growth, resilience, competitiveness and long-term success.
    • Guidelines for different stages of Start-ups: These include Inception Stage, Progression Stage, Growth Stage and Going Public Stage.
      • For instance, it provides clear definition of role and responsibilities of members of the Board, directors etc. in Progression Stage. 
    • Online Self Evaluative Governance Scorecard- It can be used to measure their current governance status and improvement over time.

 

Key Legal Provisions

  • The Companies Act, 2013 together with the Companies Rules provide a robust framework for Corporate Governance
  • The Securities and Exchange Board of India monitors corporate governance of listed companies.
  • National Foundation for Corporate Governance set up by the Ministry of Corporate Affairs.
  • Tags :
  • CII
  • Start-ups
  • Corporate Governance
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