The UN Global Compact India marked the fourth Subir Raha Memorial Lecture by choosing to tackle a much-debated topic in recent times: corporate governance. This year’s guest was U.K Sinha, Chairman of SEBI, and talked about the urgent need of good governance in the corporate arena.
The memorial talk, which is held every year in memory of former ONGC head Subir Raha, has had a history of inviting stalwarts who share their views on issues important to business. This year’s guests included Lise Grande, the UN Resident Coordinator and UNDP Resident Representative in India, Sudhir Vasudeva, Chairman and Managing Director of ONGC and also the President of the Global Compact in India, and Dr. Uddesh Kohli, Senior Advisor to the UN Global Compact India. The speaker for the memorial lecture this year was U.K Sinha, Chairman of the Securities and Exchange Board of India (SEBI).
Lise Grande set the agenda of the talk by emphasising how democratic governance is the foundation of sustainable development. Grande lay down the tone of the talk by outlining how accountability is extremely important in today;s age, “Corruption is best check through accountability. One trillion dollars is lost through illicit financial flows.” Grande emphasised the need to lay down systems of governance and accountability to ensure there is development in the right way.
U.K Sinha took the stage to recall what India and the world has been witnessing in the last few years. He called ‘social change now going beyond’ and ‘young people, home makers, ordinary citizens asking for change.’ Sinha, who has a prolific career behind him said, “Governance of corporations will also be challenged now.” He listed the various economic scandals in the last few years and blamed it saying “There was a complete failure of authorities who need to check risk management.”
According to Sinha, the discourse on corporate governance has to undergo a complete change. He listed the phases saying, “In the first generation, laws were made. Then in the second generation, the structure of key members and the concept of an independent board was introduced. Now, in the third generation, accountability has to be made the focus.” Sinha showed his vast interest, knowledge, and passion for the issue, by laying down how criminal actions should be taken for insider trading and referring to the debate over reporting, asked his audience, “Do we have a good culture of disclosure?”
Being the head of SEBI, Sinha reassured his audience about how he is trying to bring about better changes in the corporate scenario. From making it mandatory for a minimum 50 per cent of directors on a board to be independent, to making the compensation committee in corporation independent, SEBI and Sinha’s plan seemed to focus on more power being wrestled out of corporations who would mis-use powers and funds.
Sinha, concluded the talk by talking about business sustainability and said, “It is economically advantageous if a company is ethical and follows the law.” He ended to an applause, and gave hope about ushering better corporate governance in India.