New Delhi: Amidst the ongoing corporate tussle within the Tata Group, which has seen allegations against the independent directors as well, the Securities and Exchange Board of India (SEBI) has said that currently there is no reason to review the guidelines for appointment and removal of such directors.
Speaking at a capital market event here, SEBI chairman U.K. Sinha said that while there is always a need to review guidelines, he does not see any “compelling reason” to review norms for independent directors at this juncture.
“Who can be an independent director and the method of appointment, all that has been prescribed in the Companies Act and in the SEBI regulations with the SEBI norms a little tighter than the Companies Act,” said Mr. Sinha when asked if the time has come to review the norms for appointment and removal of independent directors.
“Whether there is a need to review, there is always a need to review but at this stage I do not foresee a compelling reason to review that,” he added on the sidelines of the event hosted by Association of Investment Bankers of India (AIBI).
This assumes significance as Tata Sons, the holding company of the Tata Group, has moved a resolution to remove Nusli Wadia as an independent director from the board of Tata Motors.
Incidentally, a group of investors have also filed a petition in the Bombay high court seeking a change in the manner independent directors are removed by the shareholders of the company.
The petition has made Ministry of Corporate Affairs, Ministry of Law, SEBI along with Tata Chemicals, Tata Steel and Tata Motors a party to the case.
The petition pleads that promotors should not be allowed to vote on resolutions seeking the removal of independent directors.
Bureau Report
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