The passing of the Companies Bill is all set to change the future and scenario of corporate India. Corporates, chambers of commerce and the government welcomes the move.
The Parliament on 8th December,2013 passed the historic Companies Bill 2012, moved by Sachin Pilot, Minister of Corporate Affairs. The Bill was passed by the Rajya Sabha in New Delhi which had already been passed by the Lok Sabha many months ago (in December 2012). Pilot has termed it as a historic day for the country as it will usher in a new era in the Corporate Governance.
The new Companies Bill, on its enactment, will allow the country to have a modern legislation for growth and regulation of corporate sector in India. The existing statute for regulation of companies in the country, viz. the Companies Act, 1956 had been under consideration for quite long for comprehensive revision in view of the changing economic and commercial environment nationally as well as internationally. The new law will facilitate business-friendly corporate regulation, improve corporate governance norms, enhance accountability on the part of corporates/ auditors, raise levels of transparency and protect interests of investors, particularly small investors
The salient features of the new Companies law are: Business-friendly corporate regulation/ pro-business initiatives; e-Governance initiatives; good corporate governance and CSR; enhanced disclosure norms; enhanced accountability of management; stricter enforcement; audit accountability; protection for minority shareholders; investor protection and activism; better framework for insolvency regulation; and institutional structure.
The Institute of Company Secretaries of India (ICSI) has also welcomed the new Company Law. Terming it as a modern, growth oriented and futuristic law, S. N. Ananthasubramanian, President, Council of the ICSI, said that the new law promises improved corporate governance norms, enhanced disclosures and transparency, facilitation of responsible entrepreneurship, increased accountability of company managements and auditors, protection of interest of investors particularly small and minority investors, better shareholder democracy, facilitation of corporate social responsibility (CSR) and stricter enforcement processes. He said the Act is designed to balance the stakeholders’ interests,promoters, shareholders and public at large.