K.M Birla Committee on Corporate Governance

 The K.M. Birla Committee on Corporate Governance was established in 1999 by the Securities and Exchange Board of India (SEBI) to make recommendations on corporate governance practices in India. The committee was chaired by Kumar Mangalam Birla, the Chairman of the Aditya Birla Group.

The committee was tasked with reviewing the existing corporate governance practices in India and making recommendations to improve them. The committee's recommendations covered several areas, including board composition, audit and accounting practices, disclosure requirements, and shareholder rights.

Some of the key recommendations made by the K.M. Birla Committee include:

Composition of Board of Directors: The committee recommended that at least 50% of the board of directors of a company should be independent directors. This was to ensure that the board had a diverse mix of directors with different backgrounds and expertise.

Audit and Accounting Practices: The committee recommended that companies should have an independent audit committee that would oversee the company's financial reporting and internal control processes. The committee also recommended that companies should have a system of internal controls in place to detect and prevent fraud.

Disclosure Requirements: The committee recommended that companies should disclose more information to shareholders about their operations, financial performance, and risk management practices. This was to improve transparency and accountability.

Shareholder Rights: The committee recommended that companies should respect the rights of minority shareholders and provide them with equal treatment. This included the right to participate in shareholder meetings and the right to receive dividends.

The K.M. Birla Committee's recommendations have had a significant impact on corporate governance practices in India. Many of its recommendations have been incorporated into the Companies Act and SEBI regulations. The committee's focus on transparency, accountability, and shareholder rights has helped to improve corporate governance practices in India and increase investor confidence in the Indian market.