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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