Appendix 1: List of Sample Companies

Home , Eicher Motors, Escorts Limited, Hero MotoCorp, Maruti Suzuki, TVS Motor Company

AUTO SECTOR

Two- and Three-Wheelers 1. Bajaj Auto 2. Hero Honda Motors 3. TVS Motor Company

Passenger Car 4. Mahindra & Mahindra 5. Maruti Suzuki India 6. Tata Motors

Commercial Vehicles 7. Ashok Leyland 8. Eicher Motors 9. Escorts

Auto Component 10. Amtek Auto 11. Bharat Forge 12. Sundaram Clayton

HEAVY ENGINEERING SECTOR

13. ABB 14. BHEL 15. Crompton Greaves 16. Kirloskar Oil Engines 17. Larsen & Toubro 18. Siemens 19. Voltas

224 Appendix 2: Corporate Governance Parameter Scores

Governance Parameters Point/Score Assigned

1. Statement of Company’s Philosophy on Code of 2 Governance 2. Structure and Strength of the Board 2 3. Chairman and CEO Duality: 5(max) (i) Promoter executive chairman-cum-MD/CEO 1 (ii) Non-promoter executive chairman cum 2 MD/CEO (iii) Promoter non-executive chairman 3 (iv) Non-promoter non-executive chairman 4 (v) Non-executive independent chairman 5 4. Disclosure of Tenure and Age Limit of Directors 2 5. Disclosure of: 3 (i) Definition of independent director (ID) 1 (ii) Definition of financial expert 1 (iii) Selection criteria of board of directors 1 including IDs 6. Disclosure of other Provisions as to the Board 2 and Committees 7. Disclosure of: 2 (i) Remuneration policy 1 (ii) Remuneration of directors 1 8. Code of conduct: 2 (i) Information on code of conduct 1 (ii) Affirmation of compliance 1 9. Board Committees: A. Audit committee (AC): 7 (i) Transparency in composition of audit 1 committee (ii) Compliance of minimum requirement of 1 the number of independent directors in the committee (iii) Compliance of minimum requirement 1 of the number of meetings of the committee

225 226

(Continued)

Governance Parameters Point/Score Assigned

(iv) Information about literacy and 1 expertise of committee members (v) Information about participation of 1 head of finance, statutory auditor and chief internal auditor in the committee meeting (vi) Disclosure of audit committee charter 1 and terms of reference (vii) Publishing of AC report 1 B. Remuneration/compensation committee 6 (RC): (i) Formation of the committee 1 (ii) Information about number of 1 committee meetings (iii) Compliance of minimum requirement 1 of the number of non-executive directors in the committee (iv) Compliance of the provision of 1 independent director as chairman of the committee (v) Information about participation of all 1 members in the committee meeting (vi) Publishing of RC report 1 C. Shareholders/investors grievance committee 5 (SGC): (i) Transparency in composition of the 1 committee (ii) Information about nature of complaints 1 and queries received and disposed item wise (iii) Information about number of 1 committee meetings (iv) Information about action taken and 1 investor/shareholder surveys (v) Publishing of SGC report 1 D. Nomination committee 1 E. Health, safety, and environment committee 1 F. Ethics and compliance committee 1 G. Investment committee 1 H. Share transfer committee 1 10. Disclosures and Transparency: 30 (a) Significant related party transactions having 2 potential conflicts with the interest of the company 227

(b) Non-compliance related to capital market 2 matters during last three years (c) Accounting treatment 2 (d) Board disclosure – risk management: (i) Information to the board on risk 2 management (ii) Publishing of risk management report 2 (e) Management discussion and analysis 2 (f) Shareholders’ information: (i) Appointment of new 2 director/reappointment of retiring directors (ii) Quarterly results and presentation 2 (iii) Share transfers 2 (iv) Directors responsibility statement 2 (g) Shareholder rights 2 (h) Audit qualification 2 (i) Training of board members 2 (j) Evaluation of non-executive directors 2 (k) Whistleblower policy 2 11. General body meetings: 3 (i) Location and time of general meetings held 1 in last three years (ii) Details of special resolution passed at the 1 last three AGMs/EGMs (iii) Details of resolutions passed last year 1 through postal ballot 12. Means of Communication, and General 3 Shareholder Information 13. CEO/CFO Certification 3 14. Compliance of Corporate Governance and 10(Max) Auditors’ Certificate: (i) Clean certificate from auditors 10 (ii) Qualified certificate from auditors 5 15. Disclosure of Stakeholders’ Interests: 8 (i) Environment, health and safety measures 2 (EHS) (ii) Human resource development initiative 2 (HRD) (iii) Corporate social responsibility (CSR) 2 (iv) Industrial relations (IR) 2 Total Marks 100 Notes

1 Introduction

1. Priyabrata Patnaik (2010) ‘Power Sector Reform – A New Way of Corporate Governance’ (A Case Study of Orissa), Ph.D. Thesis, Utkal University. 2. J. Wolfenshon, President of World Bank, in an article on corporate governance, Financial Times, June 21, 1999. 3. In the proceedings of the Silver Jubilee National Convention of ICSI, Chartered Secretary, October 1997. 4. SEBI’s Kumar Mangalam Birla Committee Report, January 2000. 5. Adrian Cadbury in a seminar in Mumbai, November 1996. 6. Biswajit Nag, Saikat Banerjee and Rittwik Chatterjee (2007) ‘Changing Features of the Automobile Industry in Asia: Comparison of Production, Trade and Market Structure in Selected Countries, Asia-Paciﬁc Research and Training Network on Trade,’ Working Paper Series, No. 37, July. 7. Status of Indian Automotive and Auto-Component Industry: Status Report, ACMA, 2008–9. 8. Pranav Mishra, Dr K. K. Garg and Dr Amit Naru (2013) ‘The Deming Prize – The Route to Improving Performance,’ International Journal of Advanced Research in Management and Social Sciences, Vol. 2, No. 9, 179–89. 9. Report by Ministry of External Affairs, Government of India, on Industry and Sectors, November 10, 2014. 10. Corporate India, May 15, 2008. 11. Facts And Figures, ‘Automotive Mission Plan 2006–2016: A Mission for Development of Indian Automotive Industry,’ Society of Indian Automobile Manufacturers (SIAM). 12. ‘Automotive Mission Plan 2006–2016.’ 13. Facts and Figures, ‘Ministry of Heavy Industries and Public Enterprises, Government of India, Department of Heavy Industry, Annual Report 2007– 2008.’ 14. Automotive Mission Plan 2006–2016. 15. ‘ICRA Sector Analysis, Heavy Engineering,’ May 2005, www.icraindia.com. 16. Engineering DAVOS 2006, India 2006, IBEF (Indian Brand Equity Founda- tion), www.ibef.org. 17. Economic Times (2009) ‘Engineering to Success,’ June 9. 18. ‘ICRA Sector Analysis, Light Engineering,’ June 2005, www.icraindia.com 19. Pramesh Nair and Bright Singh (2011) ‘A Study on Engineering Exports Of Gujarat,’ AMA Centre for International Trade. 20. Financial Express (2005) ‘Engineering Sector: Growing with Infrastructure,’ October 23. 21. Shivi Sharma (2009) ‘A Project Report on Bharat Heavy Electronics Limited,’ Aju Joseph. 22. Financial Express (2009) ‘Engineering Export Growth Down 13.7%,’ May 6. 23. Indian Sector Presentation (2007) Engineering, IBEF, February 29, 2008.

228 Notes 229

24. Bindu Prashanth (2010) Mechanising Growth (Times of India Publication). 25. Inderpal Kaur (1997) Impact of Liberalisation on Indian Industry (New Delhi: Deep and Deep). 26. S. C. Das (2007) ‘Corporate Governance Standards and Practices in Engineer- ing Industry in India,’ The Management Accountant, Vol. 42, No. 8. 27. CMIE stands for the Centre for Monitoring Indian Economy, whose basic task is to collect and provide company financial data in a consolidated manner, as presented in the Prowess Database Package. 28. Department of Heavy Industry (DHI), Ministry of Heavy Industries and Public Enterprises. 29. S. C. Das (2006) ‘Corporate Governance Standards and Practices in Automo- bile – 2 Wheelers Industry in India,’ The Management Accountant, Vol. 41, No. 11. 30. Economic Times (2008) ET 500, October, pp. 30–45. 31. ‘Year’ in this study connotes financial year, that is, the period beginning from 1 April of a particular year to 31 March of the next year. The CMIE database allows the user to adopt any dates as relevant for a year, although income tax requires adoption of the financial year for all accounting purposes.

2 Conceptual Framework of Corporate Governance

1. Anil Kumar and Jyotsna Rajan Arora (2014) Governance, Ethics and Social Responsibility of Business (Mumbai: International Book House). 2. Vibha Mahajan (2003) ‘Improving the Efﬁciency of Corporate Governance,’ in P. P. Arya, B. B. Tandon and A. K. Vashisht (2003) Corporate Governance (New Delhi: Deep & Deep) p. 45. 3. Milton Friedman, New York Times Magazine, 13 September 1970. 4. Cadbury Committee Report (1992) ‘Draft Report on the Financial Aspects of Corporate Governance.’ 5. K. R. Chandratre (2000) ‘Corporate Governance and Board Agenda,’ The Chartered Secretary, February, pp. 165–72. 6. Magdi Iskander, Gerald Meyerman, Dale F. Fray and Sean Hagan (1999) ‘Cor- porate Restructuring and Governance in East India,’ Finance and Development, March, p. 42. 7. P. L. Cochran and S. L. Wartick (1998) ‘Corporate Governance: A Review of the Literature,’ Financial Executives Research Foundation, Morristown, New Jersey. 8. R. A. G. Monks and Nell Minow (1995) Corporate Governance, 2nd edition (Oxford: Blackwell Publishers). 9. OECD (2004) ‘Principles of Corporate Governance,’ p. 11. 10. Prabhdeep Singh Sandhu and Manjit Kaur Sandhu (2003) Growing Rele- vance of Corporate Governance, in P. P. Arya, B. B. Tandon and A. K. Vashisht (2003) Corporate Governance (New Delhi: Deep and Deep). 11. The CalPERS Global Corporate Principles, 1996. 12. Corporate Governance Forum of Japan (1997) ‘Corporate Governance Prin- ciples: A Japanese View,’ October 30. 13. A. C. Fernando (2010) Business Ethics and Corporate Governance (London: Dorling Kindersley) 19.2, https://books.google.co.in/books?isbn=8131711730. 230 Notes

14. V. K. Pandey and Rajeev Prabhakar (2003) Corporate Governance: Its Origin, Scope and Present Scenario, in P. P. Arya, B. B. Tandon and A. K. Vashisht (2003) Corporate Governance (New Delhi: Deep & Deep), p. 24. 15. McKinsey & Company (2002) ‘Global Investor Opinion Survey on Corporate Governance,’ http://www.mckinsey.com/governance. 16. V. K. Pandey and Rajeev Prabhakar (2003) ‘Corporate Governance,’ p. 19. 17. Bikram Hundal and Seth Suresh (2003) ‘Desirable Corporate Governance in India: A Suggestive Code,’ in P. P. Arya, B. B. Tandon and A. K. Vashisht (2003) Corporate Governance (New Delhi: Deep & Deep) p. 24. 18. H. Bosch (2002) ‘The Changing Face of Corporate Governance,’ UNSW Law Journal, Vol. 25, No. 2, pp. 270–93. 19. McKinsey & Company (2002) ‘Global Investor Opinion Survey on Corporate Governance.’ 20. Horwath Pty Ltd. (2005) ‘Horwath 2005 Corporate Governance Report,’ University of Newcastle. Australia. 21. Ranjan Kumar, Vigiliance Commissioner, ‘Corporate Governance and Ethics – Challenges and Imperatives,’ Circular No. 38/10/07. 22. M. C. Jensen and W. Meckling (1976) ‘Theory of the Firm: Managerial Behaviour, Agency Cost and Ownership Structure,’ Journal of Financial Economics, Vol. 3, No. 4, pp. 305–60. 23. Ibid. 24. N. G. Zoan, ‘Finance – Professional Essays and Assignments,’ Google Books. 25. Patrick McClogan (2001) ‘Agency Theory and Corporate Governance: A Review of Literature from UK Perspective,’ pp. 4–6. Accessed via: www. ppge.ufrgs.br. pp. 26. J. H. Davis, F. D. Schoorman and L. Donaldson (1997) ‘Towards a Stewardship Theory of Management,’ Academy of Management Review, Vol. 22, No. 1, pp. 20–47. 27. J. H. Davis, F. D. Schoorman and L. Donaldson (1994) ‘Boards and Company Performance – Research Challenges the Conventional Wisdom,’ Corporate Governance: An International Review, Vol. 2, No. 3, pp. 151–4. 28. J. H. Davis, F. D. Schoorman and L. Donaldson (1991) ‘Stewardship The- ory or Agency Theory: CEO Governance and Shareholder Return,’ Australian Journal of Management, Vol. 16, No. 1, pp. 49–64. 29. Thomas Clarke (2004) ‘The Stakeholders Corporation: A Business Philoso- phy for the Information Age,’ in Thomas Clarke (2004) Theories of Corporate Governance: The Philosophical Foundation of Corporate Governance (London: Routledge) pp. 189–91. 30. A. A. Berle and G. C. Means (1934) The Modern Corporation and Private Property (New York: Macmillan). Originally published in 1932. 31. J. P. Sharma (2013) Corporate Governance, Business Ethics and CSR (New Delhi: Ane Books), p. 7. 32. EWMI/PFS Program/Lectures on Corporate Governance (2005) ‘Three Mod- els of Corporate Governance from Developed Capital Markets,’ p. 3. Accessed via: www.pfsprogram.org. 33. Michel Aglietta and Antonie Reberioux (2005) Corporate Governance Adrift: A Critique of Shareholder Value (London: Edward Elgar) pp. 22–4. Notes 231

34. L. Cernat (2004) ‘The Emerging European Corporate Governance Model: Anglo-Saxon, Continental, or still the century of diversity?,’ Journal of European Public Policy, Vol. 11, No. 1, pp. 147–66. 35. E. Wenger and C. Kaserer (1997) ‘The German System of Corporate Gov- ernance – A Model Which Should Not Be Imitated.’ Accessed via: www. econpapers.repec.org. 36. J. Franks and C. Mayer (2001) ‘Ownership and control of German corporations,’ DP 2898, Centre for Economic and Policy Research, London. Forthcoming in Review of Financial Studies. 37. T. Yasui (1999) ‘Corporate Governance in Japan,’ in Thomas Clarke, Corporate Governance: Critical Perspectives on Business and Management, Vol. IV (London: Routledge). 38. Study by Oxford Analytica. 39. R. La Porta, F. Lopez–de– Silanes, A. Shelifer and R. Vishney (1999) ‘Cor- porate Ownership Around the World,’ Journal of Finance, Vol. 54, No. 2, pp. 471–517. 40. A. Naciri (2008) ‘The MENA countries national systems of CG,’ in A. Naciri (ed.) Corporate Governance Around the World (Oxon, N.Y.: Routledge). 41. B. Yurtoglu (2003) ‘Corporate Governance and Implications for Minority Shareholders in Turkey,’ Corporate Ownership and Control, Vol. 1, No. 1, pp. 72–86. 42. A. Shleifer and R. W. Vishney (1997) ‘A Survey of Corporate Governance,’ Journal of Finance, Vol. 52, No. 2, pp. 737–83. 43. Philip Kotler and Nancy Lee (2005) Corporate Social Responsibility: Doing the Most Good for Your Company and Your Cause (Hoboken, New Jersey: John Wiley & Sons). 44. Harvard Kennedy School at http://www.hks.harvard.edu/m-rcbg/CSRI/init_ deﬁne.html (accessed September 3 2014). 45. A. B. Carroll (1991) ‘The pyramid of corporate social responsibility: toward the moral management of organizational stakeholders,’ Business Horizons, July–August, pp. 39–48. 46. Mallen Baker, http://www.mallenbaker.net/csr/deﬁnition.php. 47. Andrea Beltratti (2005) ‘The Complementarity between Corporate Gov- ernance and Corporate Social Responsibility,’ Geneva Papers on Risk & Insurance – Issues & Practice; July 2005, Vol. 30, No. 3, p. 373. 48. J. P. Sharma (2014) ‘Governance, Ethics and Social Responsibility of Business‘ (New Delhi: Ane Books) p. 232. 49. Beltratti, ‘The Complementarity between Corporate Governance and Corpo- rate Social Responsibility.’ 50. Cited from http://www.ccg.uts.edu.au/corporate_governance.htm. 51. A. Crane and D. Matten (2007) Business Ethics: Managing corporate citizenship and sustainability in the age of globalization (Oxford: Oxford University Press). 52. Manuel G. Velasquez (1998) Business Ethics: Concepts and Cases, 4th edition (Upper Saddle River, N.J: Prentice Hall). 53. A. B. Carroll and A. K. Buchholtz (2008) Business and Society: Ethics and Stakeholder Management, 7th edition (London: South-Western Cengage Learning), p. 242. 232 Notes

54. Indian Journal of Public Administration, July-September 1995, p. 638. 55. Daniel Albuquerque, (2010) Business Ethics: Principles and Practices (New Delhi: Oxford University Press). 56. http://s73976.griderver.com/sites/default/ﬁles/BRT%202010%20Principles %20Finalpdf. 57. Saleem Sheikh and William Rees (1995) Corporate Governance and Corporate Control (London: Cavendish Publishing). Economics Times (New Delhi), March 4, 2009 58. Ibid., p. 11. 59. J. P. Sharma (2014) Governance, Ethics and Social Responsibility of Business (New Delhi: Ane Books), pp. 182–92. 60. Dipankar Gupta (2006) Ethics Incorporated: Top Priority and Bottom Line (SAGE).

3 Codes and Standards of Corporate Governance

1. A. Cadbury (1992) ‘Report on the Financial Aspects of Corporate Gover- nance,’ London. 2. Study Group on Directors, Remuneration (1995) ‘Directors’ Remuneration: Report of a Study Group,’ Chaired by Sir Richard Greenbury, London. 3. ‘Hampel Final Report: Committee on Corporate Governance,’ Gee Publish- ing, London, January 1998. 4. R. Smith (2003) ‘Audit Committee Combined Code Guidance,’ pp. 3–17. Accessed via www.ecgi.org. 5. D. Higgs (2003) ‘Review of the Role and Effectiveness of Non-Executive Directors,’ pp. 3–7. Accessed via www.investmentuk.org. 6. Weil, Gotshal, and Manges (2003) ‘UK Corporate Governance Changes to the Combined Code,’ pp. 1–4. 7. ‘Blue Ribbon Committee on Improving the Effectiveness of Corporate Audit Committees,’ (1999), pp. 6–17. Accessed via www.nasdaq.com. 8. ‘The Sarbanes–Oxley Act 2002,’ pp. 3–56. Accessed via www.news.ﬁndlaw. com. 9. OECD (2004) ‘OECD Countries Agree NEW Corporate Governance Princi- ples.’ Retrieved 7/6/2004. Accessed via www.oecd.org 10. ‘Corporate Governance Codes and Principles in Commonwealth.’ Accessed via www.ecseonline.com/PDF/CACG. 11. R. Bajaj (1998) ‘Confederation of Indian Industry: Desirable Corporate Governance,’ p. 3. Accessed via www.ecgi.org. 12. SEBI (2000) ‘Report of the Kumar Mangalam Birla Committee on Corporate Governance,’ pp. 1–20. Accessed via www.sebi.gov.in. 13. Institute of Company Secretaries of India (2006) ‘Corporate Governance (Module of Best Practice),’ 4th edition, pp. 471–92. 14. Naresh Chandra Committee (2002). Report of the committee on Corporate Audit and Governance, D. C. A., Government of India. 15. The major mandatory and non-mandatory requirements of the revised Clause 49 can be found in a circular issued by SEBI on Clause 49 of the Listing Agreement, SEBI/CFD/DIL/CG/1/2004/12/10 October 29, 2004. Notes 233

4 Evaluation of Corporate Governance Compliance

1. S.C. Das (2006) ‘Corporate Governance Standards and Practices in Automo- bile – 2 Wheelers Industry in India,’ The Management Accountant, Vol. 41, No. 11. 2. The name of the company was changed from Hero Honda Motors Limited to Hero MotoCorp Limited on 29 July 2011. 3. Calculation is based on Appendix 2. 4. Calculation is based on Appendix 2. 5. Calculation is based on Appendix 2. 6. Calculation is based on Appendix 2. 7. Calculation is based on Appendix 2. 8. Calculation is based on Appendix 2. 9. Calculation is based on Appendix 2. 10. Calculation is based on Appendix 2. 11. Calculation is based on Appendix 2. 12. Calculation is based on Appendix 2. 13. Calculation is based on Appendix 2. 14. Calculation is based on Appendix 2. 15. Calculation is based on Appendix 2. 16. Annual Report of BHEL Ltd. 17. Calculation is based on Appendix 2. 18. Calculation is based on Appendix 2. 19. Calculation is based on Appendix 2. 20. Company’s Corporate Governance Philosophy, Annual Report of L&T. 21. Calculation is based on Appendix 2. 22. Calculation is based on Appendix 2. 23. Annual Reports of Kirloskar Oil Engines Ltd. 24. Calculation is based on Appendix 2. 25. Priyanka Sharma Kaushik (2013) ‘Corporate Governance – A Comparative Study of Two Major Industries of India,’ International Journal of Governance, Vol. 3, No. 2. 26. i) Priyanka Sharma Kaushik (2013) ‘Corporate Governance In Automobile Industry in India,’ International Journal of Marketing, Financial Services & Management Research, Vol. 2, No. 5. ii) Priyanka Sharma Kaushik (2013) ‘Corporate Governance In Heavy Engi- neering Industry in India,’ International Journal of Marketing, Financial Services & Management Research, Vol. 2, No. 10.

5 Summary, Conclusions, and Suggestions

1. The Pioneer (New Delhi), May 4, 2009, p. 10. 2. Economics Times (New Delhi) (2009) ‘Satyam no Wakeup Call: Governance Given Go–By,’ 14 December, p. 16. 3. Economics Times (New Delhi), June 2, 2010, p. 7. 4. Economics Times (New Delhi), March 4, 2009, p. 11. 5. Economics Times (New Delhi), April 15, 2010, p. 11. 6. Economics Times (New Delhi), January 29, 2009, p. 17. 234 Notes

7. Times of India (New Delhi), December 22, 2009, p. 23. 8. Mark S. Beasley, Joseph V. Carcello, Dana R. Harmanson, and Terry L. Neal (2010) ‘COSO Fraudulent Financial Reporting 1998–2007 – An Analysis of U.S. Public Companies,’ Kroll Global Fraud Report 2010. 9. Times of India (New Delhi), December 21, 2009. p. 23. 10. Economics Times (New Delhi), August 24, 2010. 11. Economics Times, ‘Satyam no Wakeup Call: Governance Given Go–By.’ 12. J. P. Sharma (2014) Governance, Ethics and Social Responsibility of Business (New Delhi: Ane Books). 13. Companies Act 2013. 14. Jon Swaine (2008) ‘Richard Fuld punched in face in Lehman Brothers gym,’ Daily Telegraph, London, October 7. 15. Times of India (New Delhi), March 29, 2010, p. 12. 16. ‘Rating the raters, Enron and the Credit Rating Agencies,’ Hear- ing before the Senate Committee on Governmental Affairs, 107th Congress, March 2002. Available at http://www.access.gpo.gov/congress/ senate/senate12sh107.html=4. 17. Economics Times (New Delhi), December 10, 2008, front page. 18. Sharma, Governance, Ethics and Social Responsibility of Business, pp. 182–92. 19. http://economictimes.indiatimes.com/PostSatyam_SEBI_call_for_better_ corporate_governance/articleshow/4082856.cms. Bibliography

Books and Articles

ACMA (2008–9) ‘Status of Indian Automotive and Auto-Component Industry.’ Aglietta, Michel and Antonie Reberioux (2005) Corporate Governance Adrift: A Critique of Shareholder Value (London: Edward Elgar) pp. 22–4. Albuquerque, Daniel (2010) Business Ethics: Principles and Practices (New Delhi: Oxford University Press). Bajaj, R. (1998) ‘Confederation of Indian Industry:Desirable Corporate Gover- nance.’ Accessed via www.ecgi.org. Banks, Erik (2004) Corporate Governance: Financial Responsibility, Control and Ethics (Basingstoke: Palgrave Macmillan) pp. 19–30. Bansal, C.L. (2006) Corporate Governance: Law Practice and Procedures with Case Studies (New Delhi: Taxmann) pp. 1–20. Beasley, Mark S., Joseph V. Carcello, Dana R. Harmanson, and Terry L. Neal (2010) ‘COSO Fraudulent Financial Reporting 1998–2007 – An Analysis of U.S. Public Companies,’ Kroll Global Fraud Report 2010. Beltratti, Andrea (2005) ‘The Complementarity between Corporate Governance and Corporate Social Responsibility,’ The Geneva Papers on Risk and Insur- ance – Issues and Practice. Berle, A. A. and G. C. Means (1934) The Modern Corporation and Private Property (New York: Macmillan). Originally published in 1932. Bosch, H. (2002) ‘The Changing Face of Corporate Governance,’ UNSW Law Journal, Vol. 25, No. 2, pp. 270–93. Carroll, A. B. (1991) ‘The pyramid of corporate social responsibility: toward the moral management of organizational stakeholders,’ Business Horizons, July–August, pp. 39–48. Carroll, A. B. and A. K. Buchholtz (2008) Business and Society: Ethics and Stakeholder Management, 7th edition (London: South-Western Cengage Learning), p. 242. Cernat, L. (2004) ‘The Emerging European Corporate Governance Model: Anglo- Saxon, Continental, or still the century of diversity?,’ Journal of European Public Policy, Vol. 11, No. 1, pp. 147–66. Chandratre, K. R. (2000) ‘Corporate Governance and Board Agenda,’ Chartered Secretary, Feb., pp. 165–72. Clarke, Thomas (2004) ‘The Stakeholders Corporation: A Business Philosophy for the Information Age,’ in Thomas Clarke, Theories of Corporate Gover- nance: The Philosophical Foundation of Corporate Governance (London: Routledge) pp. 189–91. Cochran, P.L. and S. L. Wartick (1992) ‘Corporate Governance: A Review of the Literature,’ Financial Executives Research Foundation, Morristown, New Jersey, May. ‘Corporate Governance Codes and Principles in Commonwealth,’ Accessed via: www.ecseonline.com/PDF/CACG. Corporate India, May 15, 2008.

235 236 Bibliography

Crane, A. and D. Matten (2007) Business Ethics: Managing corporate citizenship and sustainability in the age of globalization (Oxford: Oxford University Press). Das, S.C. (2006) ‘Corporate Governance Standards and Practices in Automobile – 2 Wheeler Industry in India,’ The Management Accountant, Vol. 41, No. 11. Das, S.C. (2007) ‘Corporate Governance Standards and Practices in Engineering Industry in India,’ The Management Accountant, Vol. 42, No. 8. Davis, J.H., F.D. Schoorman and L. Donaldson (1991) ‘Stewardship Theory or Agency Theory: CEO Governance and Shareholder Return,’ Australian Journal of Management, Vol. 16, No. 1, pp. 49–64. Davis, J. H., F.D. Schoorman and L. Donaldson (1994) ‘Boards and Com- pany Performance– Research Challenges the Conventional Wisdom,’ Corporate Governance: An International Review, Vol. 2, No. 3, pp. 151–54. Davis, J. H., F. D. Schoorman and L. Donaldson (1997), ‘Towards a Stewardship Theory of Management,’ Academy of Management Review, Vol. 22, No. 1, pp. 20–47. Economics Times (New Delhi) (2009) ‘Satyam no Wakeup Call: Governance Given Go–By,’ December 14, p. 16. EWMI/PFS Program/Lectures on Corporate Governance (2005) ‘Three Models of Corporate Governance from Developed Capital Markets,’ p. 3. Accessed Via: www.pfsprogram.org. Fama, E. F. (1980) ‘Agency Problems and the Theory of the Firm,’ Journal of Political Economy, 88, pp. 288–307. Fama, E. F. and M. C. Jensen (1983a) ‘Separation of Ownership and Control,’ Journal of Law and Economics, 26, pp. 301–25. Fama, E. F. and M. C. Jensen (1983b) ‘Agency Problems and Residual Claims,’ Journal of Law and Economics, 26, pp. 327–49. Fernando, A. C. (2010) Business Ethics and Corporate Governance (London: Dorling Kindersley) 19.2, https://books.google.co.in/books?isbn=8131711730. Financial Express (2005) ‘Engineering Sector: Growing with Infrastructure,’ 23 October. Franks, J. and C. Mayer (2001) ‘Ownership and Control of German Corporations,’ DP 2898, Centre for Economic and Policy Research, London. Forthcoming in Review of Financial Studies. Gupta, C.B. (2014) Governance, Ethics and Social Responsibility of Business (New Delhi: Sultan Chand). Horwath Pty Ltd., ‘Horwath Corporate Governance Report,’ University of Newcastle, Australia. Hundal, Vikram and Seth Suresh (2003) ‘Desirable Corporate Governance in India: A Suggestive Code,’ in P. P. Arya, B. B. Tandon and A. K. Vashisht (eds) Corporate Governance (New Delhi: Deep and Deep), p. 24. ICRA Sector Analysis, Heavy Engineering, May 2005, www.icraindia.com. Indian Brand Equity Foundation (2006) ‘Automotive India.’ Indian Brand Equity Foundation (2006) ‘Engineering DAVOS 2006.’ Indian Sector Presentation (2007) Engineering, IBEF: Feb 29, 2008. Institute of Company Secretaries of India (2006) ‘Corporate Governance (Module of Best Practice),’ 4th edition, pp. 471–92. Iskander, Magdi, Gerald Meyerman, Dale F. Fray and Sean Hagan (1999) ‘Cor- porate Restructuring and Governance in East India,’ Finance and Development, March, p. 42. Bibliography 237

Jensen, M.C. and W. H. Meckling (1976) ‘Theory of the Firm: Managerial Behav- ior, Agency Cost and Ownership Structure,’ Journal of Financial Economics, Vol. 3, No. 4, pp. 305–60. Kaur, Inderpal (1997) Impact of Liberalisation on Indian Industry (New Delhi: Deep and Deep). Kaushik, Priyanka Sharma (2013) ‘Corporate Governance – A Comparative Study of Two Major Industries of India,’ International Journal of Governance,Vol.3 No. 2. Kaushik, Priyanka Sharma (2013) ‘Corporate Governance in Automobile Indus- try in India,’ International Journal of Marketing, Financial Services & Management Research, ISSN 2277– 3622, Vol. 2, No. 5. Kaushik, Priyanka Sharma (2013) ‘Corporate Governance in Heavy Engineer- ing Industry in India,’ International Journal of Marketing, Financial Services & Management Research, ISSN 2277– 3622, Vol. 2, No. 10. Kotler, Philip and Nancy Lee (2005) Corporate Social Responsibility: Doing the Most Good for Your Company and Your Cause (Hoboken, New Jersey: John Wiley & Sons). Kumar, Anil and Jyotsna Rajan Arora (2014) Governance, Ethics and Social Respon- sibility of Business (Mumbai: International Book House). Kumar, Ranjan, Vigiliance Commissioner, ‘Corporate Governance and Ethics – Challenges and Imperatives,’ Circular No. 38/10/07. La Porta, R., F. Lopez–de–Silanes, A. Shelifer and R. Vishney (1999) ‘Cor- porate Ownership Around the World,’ Journal of Finance, Vol. 54, No. 2, pp. 471–517. Mahajan, Vibha (2003) ‘Improving the Efﬁciency of Corporate Governance,’ in P. P. Arya, B. B. Tandon and A. K. Vashisht (2003) Corporate Governance (New Delhi: Deep and Deep) p. 45. McClogan, Patrick (2001) ‘Agency Theory and Corporate Governance: A Review of Literature from UK Perspective.’ Accessed via: www.ppge.ufrgs.br., pp. 4–6. McKinsey & Company (2002) ‘Global Investor Opinion Survey on Corporate Governance,’ http://www.mckinsey.com/governance. Mishra Pranav, Dr K. K. Garg, and Dr Naru Amit (2013) ‘The Deming Prize–The Route to Improving Performance,’ International Journal of Advanced Research in Management and Social Sciences, Vol. 2, No. 9, pp. 179–89. Monks, R.A.G. and Nell Minow (2001) Corporate Governance (Oxford: Blackwell Publishers), 2nd edition. Naciri, A. (2008) ‘The MENA countries national systems of CG,’ in A. Naciri (ed.) Corporate Governance Around the World (Oxon, N.Y.: Routledge). Pandey, V. K. and Rajeev Prabhakar (2003) ‘Corporate Governance: Its Origin, Scope and Present Scenario,’ in P. P. Arya, B. B. Tandon and A. K. Vashisht (2003) Corporate Governance (New Delhi: Deep and Deep) p. 24. Patnaik, Priyabrata (2010) ‘Power Sector Reform – A New Way of Corporate Governance’ (A Case Study of Orissa), PhDthesis, Utkal University. Prashanth, Bindu (2010) Mechanising Growth (Times of India Publication). ‘Rating the Raters, Enron and the Credit Rating Agencies,’ Hearing before the Senate Committee on Government al Affairs, 107th Congress, March 2002. Available at http://www.access.gpo.gov/congress/senate/senate12sh107. html=4. 238 Bibliography

Ruback, Richard S. and Michael C. Jensen (1983) ‘The Market for Corporate Control: The Scientiﬁc Evidence,’ Journal of Financial Economics, Vol. 11, pp. 5–50. Sandhu, Prabhdeep Singh and Manjit Kaur Sandhu (2003) ‘Growing Relevance of Corporate Governance,’ in P. P. Arya, B. B. Tandon and A. K. Vashisht (2003) Corporate Governance (New Delhi: Deep and Deep). Sarbanes–Oxley Act 2002, pp. 3–56. Accessed via: www.news.ﬁndlaw.com. Sharma, J.K. (2012) Business Statistics (London: Pearson Education). Sharma, J.P. (2008) ‘Satyam – A Case of Unethical Conduct and Fake Audit,’ Indian Journal of Commerce, Vol. 62, pp. 80–9. Sharma, J.P. (2014) Governance, Ethics and Social Responsibility of Business (New Delhi: Ane Books). Sheikh, Saleem and William Rees (1995) Corporate Governance and Corporate Control (London: Cavendish Publishing). Shleifer, A. and R. W. Vishney (1997) ‘A Survey of Corporate Governance,’ Journal of Finance, Vol. 52, No. 2, pp. 737–83. SIAM (Society of Indian Automobile Manufacturers) ‘Automotive Mission Plan 2006–2016: A Mission for Development of Indian Automotive Industry.’ SIAM (Society of Indian Automobile Manufacturers) (1999) ‘Recommendations for Developing Indian Automobile Policy,’ Working Paper, May. Singh, Kavita (2000) ‘Study of Work Culture in Selected Indian Organization,’ PhD thesis (unpublished), University of Delhi. Smith, R. (2003) ‘Audit Committee Combined Code Guidance,’ pp. 3–17. Accessed viawww.ecgi.org. Study Group on Directors, Remuneration (1995) ‘Directors’ Remuneration: Report of a Study Group.’ Chaired by Sir Richard Greenbury, London. Swaine, Jon (2008) ‘Richard Fuld Punched in Face in Lehman Brothers Gym,’ Daily Telegraph, London, October 7. Times of India (New Delhi), December 22, 2009, p. 23. Weil, Gotshal&Manges (2003) ‘UK Corporate Governance Changes to the Com- bined Code,’ pp. 1–4. Wenger, E and C. Kaserer (1997) ‘The German System of Corporate Governance– A Model Which Should Not Be Imitated.’ Accessed via: www.econpapers.repec. org. Wolfensohn, J., President, World Bank, Financial Times, June 21, 1999. Yasui, T. (1999) ‘Corporate Governance in Japan,’ in Thomas Clarke, Corporate Governance: Critical Perspectives on Business and Management, Vol. IV (London: Routledge). Yurtoglu, B. (2003) ‘Corporate Governance and Implications for Minority Share- holders in Turkey,’ Corporate Ownership and Control, Vol. 1, No. 1, pp. 72–86. Zoan, N. G., ‘Finance – Professional Essays and Assignments,’ Google Books.

Reports of Accredited Committees

Annual Reports of Ministry of Heavy Industries and Public Enterprises, Govern- ment of India, Department of Heavy Industry. Auto Component Manufactures association (ACMA) Annual Reports. ‘Blue Ribbon Committee on Improving the Effectiveness of Corporate Audit Committees’ (1999), pp. 6–17. Accessed via www.nasdaq.com. Bibliography 239

CACG Guidelines: Principles for Corporate Governance in the Commonwealth (1999). Cadbury, A. (1992) ‘Report on the Financial Aspects of Corporate Governance,’ Gee & Co., London. CII code on Corporate Governance: ‘Desirable Corporate Governance: A Code,’ New Delhi: CII, 1997. Combined Code, ‘The Combine Code on Corporate Governance,’ Gee & Co, London, 2003. Corporate Governance Codes and Principles in Commonwealth. Euroshareholders Corporate Governance Guidelines (2000). Greenbury, R., ‘Directors’ Remuneration: Report of the Study Group,’ Gee Publishing, London, 1995. Hampel, R. ‘Committee on Corporate Governance: Final Report,’ Gee Publishing, London, 1998. Higgs D., ‘Review of the Role and Effectiveness of Non–Executive Directors,’ Department of Trade and Industry, London, 2003. Institute of Company Secretaries of India (2006) ‘Corporate Governance (Module of Best Practice),’ 4th edition. J.J. Irani Committee Report (2005) (India). Kumar Mangalam Birla Committee Report on Corporate Governance, SEBI, India (2000). N.R. Narayana Murthy Committee Report, India, 2003. Naresh Chandra Committee (2002). Report of the committee on Corporate Audit and Governance, D.C.A., Government of India. Naresh Chandra Committee Report on Regulation of Private Companies and Partnership, India, 2003. OECD (2004) ‘OECD Countries Agree New Corporate Governance Principles.’ Sarbanes–Oxley Act, US, 2002. SEBI (2008) Amending certain provisions of Clause 49 relating to Corporate Governance. Society of Indian Automobile Manufacturers (SIAM) Statistical Proﬁle and Press Release. Further Reading

Agarwal, A. and C. Knoeber (1999) ‘Outside Directors, Politics and Firm Perfor- mance,’ Working Paper, Columbia University. Agarwal, R. N. (1987) Corporate Investment and Financing Behaviour: A Case Study of Indian Automobile Industry (Delhi: Commonwealth Publishers). Agarwal, R. N. (1991) ‘Profitability and Growth in Indian Automobile Manufac- turing Industry,’ Indian Economic Review, Vol. 26, No. 1, pp. 81–97. Baysinger, B. and H. Butler (1985) ‘Corporate Governance and the Board of Direc- tors: Performance Effects of Changes in Board Composition,’ Journal of Law, Economics and Organization, Vol. 1, No. 1, pp. 101–24. Bhagat, S. and B. Black (1997) ‘Do Independent Directors Matter?,’ Working Paper, Columbia University. Bhatnagar, Anjali (2006) ‘Working Capital Management in the Automobile Industry in India,’ PhD thesis, Delhi University. Bhattacharyya, Asish K. and Rao Sadhalaxmi Vivek (2005) ‘Economic Impact of Regulation on Corporate Governance: Evidence from India.’ Accessible via: http://econpapers.repec.org/paper/wpawuwpfi/0504002.htm. Black, Bernard S. and Vikramaditya S. Khanna (2007) ‘Can Corporate Governance Reforms Increase Firms’ Market Values: Event Study Evidence from India,’ Journalof Empirical Legal Studies, Vol. 4, No. 4, pp. 749–96, Brown, L. D. and M. L. Caylor (2004) ‘Corporate Governance and Firm Perfor- mance,’ Working Paper, Georgia State University. Accessible via: http://ssrn. com/abstract=526423. Ghosh, Saswati (2003) ‘Corporate Social Responsibility: The Third Pillar of Sustainable Development,’ in P. P. Arya, B. B. Tandon and A. K. Vashisht Corporate Governance (Deep & Deep), pp. 201–14. Ghuman, B. S. and Bhawna Gupta (2003) ‘Corporate Governance in Public Enter- prises: The Indian Experience,’ in P. P. Arya, B. B. Tandon and A. K. Vashisht Corporate Governance (Deep & Deep), pp. 332–41. Giri, M. S. R. Sesha and Dr B. Madhukar (2007) ‘Corporate Governance: Con- temporary Issues and Challenges,’ in P. V. Sarma and S. Rajani (eds) Corporate Governance: Contemporary Issues and Challenges (Kanishka) pp. 117–22. Goldar, B. N., V. S. Renganathan and Rashmi Banga (2003) ‘Ownership and Effi- ciency in Engineering Firms in India, 1990–91 to 1999–2000,’ Economic and Political Weekly, Vol. 39, No. 5, pp. 441–7. Hermalin, B. and M. Weisbach (1991) ‘The Effect of Board Composition and Direct Incentives on Firm Performance,’ Financial Management, Vol. 20, No. 4, pp. 96–118. Jairus, Banaji and Gautam Mody (2001) ‘Corporate Governance and the Indian Private Sector,’ QEH Working Paper Series no. 73, University of Oxford. Kaur, Kamlesh (1982) ‘Voluntary Disclosure Practice in India,’ M.Phil. dissertation, University of Delhi.

240 Further Reading 241

Kaur, Prabhsharan (1988) ‘Determinants of Investment–A Case Study of Engi- neering Industry (with special reference to Automobile Industry),’ M.Phil dissertation, Dept. of Commerce, Delhi University. Klein, A. (1998) ‘Firm Performance and Board Committee Structure,’ Journal of Law and Economics, Vol. 41, pp. 275–99. Malhotra, Manisha, ‘Corporate Governance: An Analysis with Special Reference to Audit Committee,’ M.Phil dissertation, University of Delhi, 2007. Mukherjee, Diganta and Tejamoy Ghosh (2004–06) ‘An Analysis of Corporate Per- formance and Governance in India: Study of Some Selected Industries,’ Indian Statistical Institute, Kolkata, India. Narayanan, Badri G. and Pankaj Vashisht (2008) ‘Determinants of Competitive- ness of the Indian Auto Industry,’ Working Paper No. 201, ICRIER. Oquist, Paul (2000) ‘Ethics and Integrity for the Development of Democratic Governance Capability,’ Corporate Excellence through Corporate Governance, ICSI – CCRT, Mumbai. Panda, Hrushikesh (1996) ‘An Economic Analysis of the Road Transport Vehicle Industry in India,’ PhD thesis, University of Delhi. Parker, S. and G. F. Peters (2002) ‘Corporate Governance and Corporate Failure: A Survival Analysis,’ Corporate Governance, Vol. 2, No. 2, pp. 4–12. Prasad, Kesho (2006) Corporate Governance (Delhi: Prentice Hall of India) p. 189. Rathore, Shyam Babu (1983) ‘India’s Export of Engineering Goods to Selected Asian Countries,’ M.Phil, dissertation, Dept. of Commerce, University of Delhi. Sareen, V. K. and Subbash Chander (2003) ‘Corporate Disclosure Practices – An Empirical Study of Corporate Governance,’ pp. 145–58. Scherrer, P. S. (2003) ‘Director’s Responsibilities and Participation in the Strategic Decision Making Process,’ Corporate Governance, Vol. 3, No. 1, pp. 86–90. Srikrishna, S. (2004) ‘Corporate Governance – The Chartered Accountant’s Perspective,’ Chartered Accountant, July. UN Global Compact Report (2004) ‘Who Cares Wins: Connecting Financial Markets to a Changing World,’ 2004, pp. i. Verma, Neena (1992) ‘Determinants of Corporate Growth: A Study of Engineering Companies,’ Dept. of Commerce, M.Phil. dissertation, University of Delhi. Yahoo Wikipedia, ‘Corporate Governance.’

Websites www.cicsa.com.au/media.html: Corporate Governance Reporting Award. www.conference–board.org/products: The Conference Board among others: Global Corporate Governance Research Center. www.corpgov.net:cg: Corporate Governance. www.ecgn.org: European Corporate Governance Network. www.icgn.oi–g: International Corporate Governance Network. www.NEDnet.com: NEDnet. www.en.wikipedia.org/wiki/corporate–governance. www.sebi.com: SEBI. www.nseindia.com: National Stock Exchange. www.economictimes.com: Economic Times. www.directorship.com: National Association of Corporate Directors. Index

A Bajaj, Rahul, 14 ABB Limited, 6, 169–178, 203, 204, Baker, Mallen, 23 206, 207, 224 Berle, A.A., G.C. Means, 19 accountability, 18, 26, 33 Bharat Forge Limited, 137–144, 203, agency theory, 18, 19 204, 206, 207, 224 American Institute of Certified Public Bharat Heavy Electrical Limited, 6, Accountant (AICPA), 34 153–161, 203, 204, 206, 207, 224 American Stock Exchange, 34 Birla, K.M., 2 Amtek Auto Limited, 121–129, 203, Blue Ribbon Committee(US), 9, 33–34, 204, 206, 207, 224 214, 232 Anglo-Saxon Model, 20 report on; see Improving the areas for improvement, 217–218 Effectiveness of Corporate Audit Ashok Leyland Limited, 95–104, 203, Committees 204, 206, 207, 224 Bosch, H., 16, 17 audit committee, 40, 42, 44, 46, 50, board of directors, 15, 18, 20, 21, 22, 58, 67, 74–75, 83, 91, 99, 108, 29, 31, 33, 36–37 116, 124, 133, 141, 148, 156, 165, structure, strength, and size of, 43, 173, 181, 189, 197, 209, 219, 225 45, 47, 55, 64, 72, 81, 89, 96, see also Smith Report on Audit 105, 113, 122, 130, 138, 145, Committee and Blue Ribbon 154, 163, 170, 179, 186, 195 Committee meetings of, 43, 45, 48, 56, 65, 73, auditors,34, 35, 41, 219 see also 81, 89, 97, 106, 115, 122, 131, Sarbanes-Oxley (SOX) Act (US) 139, 145, 154, 163, 171, 179, appointment and rotation of, 35, 187, 196 39, 41, 219 business ethics, 25–27 role of, 29 auditors’ certificate, 45, 53, 62, 71, 79, C 87, 95, 103, 112, 119, 129, 136, Cadbury, Sir Adrian 2, 12 16, 24, 29 144, 153, 161, 169, 177, 185, 194, Cadbury, Sir Adrian Committee (UK), 201, 227 9, 29, 229 automobile industry, 3–5, 7–8, 10, report of, 29, 214 47–144, 202–208, 212, CalPERS Principles (US), 9, 14, 33, 215–217, 224 214, 229 domestic sales of, 5 CarrollandA.K.Buchholtz,25 export of, 5 Carroll, Archie, 23 forward and backward linkages of, 3 CEO and CFO certification, 45, 53, 61, India rank, 4 70, 79, 87, 94, 102, 112, 119, 129, automotive mission plan, 4 136, 144, 152, 161, 169, 177, 185, 193, 201 B chairman and CEO duality, 43, 49, 56, bad governance, 16 66, 73, 82, 90, 97, 107, 115, 122, Bajaj Auto Limited, 55–63, 203, 204, 131, 140, 146, 155, 163, 171, 180, 206, 207, 224 187, 196, 225

242 Index 243

Chandra, Naresh, 39, 41 pillars of, 18 Chandratre, K.R., 13 theories of, 18–20 CII Desirable Code on Corporate variations in compliance of, 2–3 Governance, 38, 214 corporate governance at global level, Clause 49 of Listing Agreement, 39, 28–38, 213 43, 214 corporate governance codes in the US, Cochran, P.L., and S. L. Wartick, 13 33–35 code of best practice, 29, 30 corporate governance parameter code of conduct, 44, 50, 58, 66, 74, scores, 55, 63, 71 79, 88, 104, 113, 83, 91, 99, 107, 116, 124, 132, 121, 129, 137, 144, 153, 161, 169, 140, 148, 156, 164, 172, 181, 189, 178, 185, 194, 202, 225 197, 222, 225 corporate governance reports and code of ethics, 25, 26 codes in the UK, 29–33 Combined Code of Best Practices corporate governance voluntary (London Stock Exchange), 9, guidelines, 9, 41, 215 31, 214 corporate social responsibility, 23–25, Combined Code of Corporate 41, 45, 54, 63, 227 Governance (London Stock committee of, 24 Exchange), 32 policy of, 25 Commonwealth Association for Crane, A. and D. Matten, 25 Corporate Governance (CACG), 9, Crompton & Greaves Limited, 36, 232 186–194, 203, 204, 206, Principles of, 36–37 207, 224 Companies Act (1956), 3, 40, 45, 209, 215 Companies Act (2013), 24, 41 D companies’ grading on corporate Davis, J.H., 19 governance, 46, 204 definition of independent directors companies’ scores on corporate and financial experts, 44, 49, 57, governance, 203 66, 74, 82, 91, 98, 107, 115, 123, company philosophy on code of 132, 140, 147, 156, 164, 172, 180, governance, 43, 47, 55, 64, 71, 80, 188, 197 88, 96, 105, 113, 121, 130, 138, directors, 145, 153, 162, 170, 178, 186, 194, remuneration of, 44, 50, 58, 66, 74, 208, 215, 225 83, 91, 99, 108, 116, 124, 133, comparison of auto sector and heavy 140, 148, 156, 165, 173, 181, engineering sector, 9, 212 189, 197, 210, 218, 225 Confederation of British Industry, 29 selection criteria of, 44, 49, 57, 66, Confederation of European 74, 82, 91, 98, 107, 115, 123, Shareholders Association, 37 132, 140, 147, 156, 164, 172, Confederation of Indian Industries 180, 188, 197 (CII), 9, 14, 38, 41, 214, 239 tenure and age limit of, 44, 49, 57, corporate governance, 1–2 66, 74, 82, 90, 98, 107, 115, benefits of, 17 123, 132, 140, 147, 155, 163, definition of, 12–14 172, 180, 188, 196, 218, 225 importance of, 14–16 Responsibility Statement of, 54, 62, major players of, 19 69, 78, 86, 94, 103, 111, 120, models of, 20–24 128, 136, 143, 151, 160, 168, need for, 14–16 176, 184, 192, 200, 226 244 Index disclosure of stakeholders’ interest, export of, 7 45, 54, 63, 71, 79, 87, 95, 104, light engineering segment of, 6 112, 120, 129, 137, 144, 153, 161, Hero Honda Motors, 47–54, 203, 204, 169, 177, 185, 194, 201, 227 206, 207, 224, 233 Donaldson, L., 19 Higgs Report, (UK), 32, 33, 214, 232 dual board system, 21 Horwath Report, 17 Hundal, Vikram, and Suresh Seth, 16 E hypotheses, 9, 43, 212, 205, Eicher Motors Limited, 104–113, 203, 208, 217 204, 206, 207, 224 Escorts Limited, 113–121, 203, 204, I 206, 207, 224 improving the effectiveness of ethics and compliance committee, 44, corporate audit committees, 34, 76, 167, 216 214, 232 Euroshareholders Corporate insider model, 20–22 Governance Guidelines, independent directors, 20, 30, 42, 48, 37–38 56, 64, 72, 81, 89, 97, 105, 114, 123, 131, 138, 146, 154, 163, 171, F 179, 187, 195 fairness, 17, 18, 33, 36 investment committee, 76, 85, 149, Fama, E.F., 19 167, 210 family-based model, 22–23 Iskander, Meyerman, Fray, and Fernando, A.C., 15 Hagan, 13 Financial Report Council, 13, 29, 31 J firm valuation, 17 J.J. Irani Committee, 9, 40, 215 Japanese model, 21–22 G Jenson, M.C., 19 general body meeting, 44, 53, 61, 70, justification of study, 7–8 77, 86, 93, 102, 109, 119, 127, 135, 144, 152, 159, 168, 176, 183, K 193, 200, 227 Kiroskar Oil Engines Limited, 137, German model, 20–21 194–202, 203, 204, 206, 207, good governance, 16, 17 224, 233 Greenbury Report (UK), 9, 29–31, Kotler, Philip and Nancy Lee, 23 214, 232 Kumar Mangalam Birla Committee Greenbury, Sir Richard, 29, 232 Report, 2, 18 Gupta, Dipankar, 26–27 L H Larsen & Toubro Limited 6, 178–185, Hampel Report (UK), 9, 30, 31, 203, 204, 206, 207, 224 214, 232 limitations of study, 10–11, 213 Harvard’s Kennedy School of Lipworth, Sir Sydney, 13 Business, 23 listed companies, 10, 206 heavy engineering industry, 6–8, 9, Listing Agreement, 3, 39–40, 43, 45, 144–202, 202–208, 212, 206, 208, 215, 217 215–217, 224 London Stock Exchange, 9, 29, 31, central statistic survey of, 6 32, 214 Index 245

M 117, 126, 135, 142, 149, 158, 166, Mahajan, Vibha, 12 173, 182, 190, 198, 208, 215 Mahindra & Mahindra Limited, non-mandatory 80–88,203, 204, 206, 207, 224 disclosures/requirements, 3, 40, mandatory board committees, 44, 50, 44, 53, 61, 70, 77, 86, 93, 102, 58, 67, 74, 83, 91, 99, 108, 116, 109, 119, 127, 135, 143, 152, 159, 124, 133, 141, 148, 156, 165, 173, 167, 175, 183, 193, 199, 210, 181, 189, 197, 208 218, 222 Management Discussion and Analysis Report, 38, 54, 62, 69, 78, 86, 94, O 103, 111, 120, 128, 136, 143, 151, objective of study, 8–9 160, 168, 176, 184, 192, 200, 226 OECD Maruti Suzuki India Limited, 88–95, deﬁnition by, 9, 13, 23 203, 204, 206, 207, 224 principles of, 35–36, 37, 214 McKinsey survey, 15, 17 outsider model, 20 means of communication, 45, 53, 61, 70, 78, 87, 94, 102, 112, 119, 128, P 135, 144, 152, 159, 168, 177, 184, Pandey and Prabhakar, 15 193, 201 Patnaik, Priyabrata, 1 Meckling, W., 19 period of study, 10 Milton, Friedman, 12 postal ballot, 45, 53, 77, 86, 93, 111, Ministry of Corporate Affairs, 40, 119, 135, 152, 168, 176, 183, 227 41, 221 Public Company Accounting Monks, R.A.G. and Neil Minow, Oversight Board (PCAOB), 34, 13, 229 35, 220 Murthy, N.R. Narayan, 39 Public Company Accounting Reforms and Investor Protection Act, see N Sarbanes-Oxley Act Naresh Chandra Committee Report, 9, Punjab, Haryana and Delhi Chamber 39, 40, 214 of Commerce, 25 National Association of Corporate Directors (NACD), 13 R National Association of Securities related party transactions, 41, 54, 62, Dealers Automated Quotations 69, 78, 86, 94, 103, 111, 120, 128, (NASDAQ), 34, 232 136, 143, 151, 160, 168, 176, 184, New York Stock Exchange (NYSE), 33 192, 200, 226 nomination committee, 31, 41, 44, remuneration committee, 30, 39, 42, 76, 167, 182 46, 53, 60, 68, 76, 85, 92, 100, non-executive directors, 20, 29, 31, 108, 117, 126, 135, 142, 149, 158, 48, 56, 64, 72, 81, 89, 97, 105, 166, 173, 182, 190, 199, 210, see 114, 123, 131, 138, 146, 154, 163, also Greenbury Report 171, 179, 187, 195 remuneration policy, 44, 50, 58, 66, evaluation of, 63, 70, 79, 87, 95, 74, 83, 91, 99, 108, 116, 124, 133, 104, 112, 121, 129, 152, 161, 140, 148, 156, 165, 173, 181, 189, 169, 177, 185, 193, 201, 210, 197, 210, 218, 225 217, 218, 221, 227 research methodology, 9 role of, 32 responsibility, 18, 36 non-mandatory board committee, 44, revisedClause49oftheListing 51, 59, 68, 76, 85, 92, 100, 108, Agreement, 3, 40, 206, 217 246 Index revised Combined Code (UK), 9, 143, 151, 160, 168, 176, 184, 32–33, 214 192, 200 Ruback, Richard, S., 19 stewardship theory, 19 suggestions, 219–222 S Sundaram-Clayton, 130–137, 203, sample size, 10, 208, 224 204, 206, 207, 224 Sandhu, Prabhdeep Singh, and ManjitKaur Sandhu, 14 T Sarbanes-Oxley (SOX) Act (US), 9, Tata Motors Limited, 4, 71–79, 203, 34–35, 214, 220 204, 206, 207, 224 Satyam ﬁasco, 1, 15, 16, 41, 219, 222 The Institute of Business Ethics, scams and fraud, 15, 16, 219 London, 25 Schoorman, F.D., 19 The Institute of Company Secretaries scope for future study, 223 in India (ICSI), 2 SEBI’s Kumar Mangalam Birla tools used for analysis, 10 Committee, 2, 9, 38–39, 214 key governance parameter, 3, 10, SEBI’s Narayan Murthy Committee, 46, 215 39–40, Mann-Whitney U test, 10, 43, secondary data, 9, 11, 213 207–08, Securities and Exchange Board of non parametric test, 207 India (SEBI), 3, 38, 39, 55, 96, 214, paired difference ‘t’ test, 10, 43, 219, 220, 221, 222, 228, 232, 234, 205–06 239, 241 percentage, 10, 43, 203 Securities and Exchange Commission rank, 10, 43, 46, 202–03 (SEC), 33, 34 point value system 10, 46, separation of ownership and control, 208–209, 215 14, 15, 18, 33 transparency, 18, 26, 36, 44, 53, 60, shareholders/investors grievance 69, 77, 85, 93, 102, 109, 119, committee, 38, 44, 46, 50, 59, 67, 127,135, 142, 151, 158, 167, 175, 75, 83, 92, 99, 108, 116, 125, 134, 183, 192, 199, 226 141, 148, 157, 166, 181, 189, 198, TVS Motors Company Limited, 63–71, 209–210 203, 204, 206, 207, 224 shareholder right, 36, 63, 70, 79, 87, 95, 104, 112, 121, 129, 152, 161, 169, 177, 185, 193, 201, 210, 217, U 218, 221, 227 unitary board, 20, 22 share transfer committee, 44, 51, 77, 85, 108, 119, 126, 149, 158, 199 V Siemens Limited, 145–153, 203, 204, Velasquez, G. Manuel, 25 206, 207, 224 Voltas Limited, 162–169, 203, 204, Smith Report on Audit Committee 206, 207, 224 (UK), 9, 31–32, 214, 232 Smith, Adam, 14–15 W Smith, Sir Robert, 31 whistleblower policy, 35, 39, 41, 63, stakeholder theory, 19 70, 79, 87, 95, 104, 112, 121, 129, Standard & Poor, 13 152, 161, 169, 177, 185, 193, 201, statutory disclosure, 46, 54, 62, 69, 78, 210, 217, 218, 221, 227 86, 94, 103,111, 120, 128, 136, Wolfenshon, J., 1