The Confederation of Indian Industry (CII), a major industry body, has come up with a Corporate Government Charter that will serve as a self-governing code for compliance for startups.
This Charter is intended for start-up companies to follow on a best efforts basis, to help start-up companies become responsible corporate citizens, and for companies to share this Charter with their stakeholders and The purpose is to help establish that the country is well-governed.
According to CII, the charter is intended to be used as a “ready tool” for startups as they navigate the path to good governance.
- Also read:India is growing even when the world is under stress: Sanjiv Puri appointed as CII chairman
This charter has been carefully selected to provide guidance in the startup lifecycle, which is divided into four stages: founding, development, growth, and going public.
At each stage, governance principles are identified that may be further focused.
R. Dinesh, President, CII and Chairman, TVS Supply Chain Solutions, said that early adoption of good governance practices helps startups achieve long-term value creation, stakeholder trust, and funding from investors and banks. He said there will be tangible and intangible benefits, such as improved access to procurement. Dependence on promoters, effective organizational structure and improved chances of long-term survival of the business.
He hoped that the charter would enable startups to adopt good governance practices early on, helping them evolve into tomorrow’s leaders.
- Also read:India is now the first choice for manufacturing investments, says CII Chairman R. Dinesh
According to the CII Charter, during the ‘start-up’ stage, startup governance focuses on board composition, setting the tone at the top, compliance monitoring, accounting, finance, external auditing, related party transaction policies, and dispute resolution mechanisms. There is a possibility that it will be placed.
In the ‘Advanced’ stage, startups will further expand board oversight, monitor key business metrics, maintain internal controls, define decision-making hierarchies, provide an intensive overview of finance, accounting and external audit, There is a possibility that there will be an emphasis on meeting and risk and crisis establishment. management.
Once a startup reaches the ‘growth’ stage, it increases stakeholder awareness of the vision, mission, code of conduct, culture, organizational ethics, functional policies and procedures, constitutes board committees, and promotes diversity, equity, There may also be a focus on ensuring inclusivity (DE&I). on board.
Meeting legal requirements under the Companies Act 2013 and all other applicable laws and regulations, focusing on the utilization of funds, monitoring and review, complying with CSR and ESG norms, strategic progress and HR-related aspects should be monitored.
During the ‘listing’ stage, start-ups should monitor the functioning of various committees, prevent and detect fraud, focus on grievance redressal mechanisms, minimize information asymmetry, effectively manage stakeholders, and plan for succession. , there is the potential to expand governance in terms of board performance evaluation, etc.
The CII Charter also provides governance policies, internal controls, social media policies, He said the company also needs to begin reviewing its compliance program.
This is the last free article.
