Institutional EYE

Commentary on Corporate Governance Issues

Rethinking the Boards Stakeholder Relationship Committee

In this digital era when shares are dematerialized and do not have the pain associated with the transfer of physical shares, and when dividends are directly credited ‘grievances’ are negligible the Stakeholders’ Relationship Committee has to start playing a critical role. It needs to keep itself updated not just who the company’s current and potential investors are, but also engage with investors to understand how they vote and why they vote the way they do. For the full report, please click here.

Listing of L&T’s subsidiaries: Management creates its own ‘options’

L&T’s executive directors have been opportunistic – they have generously issued themselves stock options at face value from subsidiaries before their IPO’s. The manner and timing of these issuances raise questions on L&T’s governance practices, and the checks and balances the company has in place. As part of its long term strategy to unlock value, Larsen & Toubro Limited (L&T) decided to list two of its 121 subsidiaries in 2016 – Larsen & Toubro Infotech Limited (Infotech) and L&T Technology Services Limited (TechServices). As a conglomerate with several businesses, L&T’s decision to list these businesses as they reach critical mass is good for its shareholders. But, L&T’s management has als

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