I refer to your editorial “Let in light”, Mint, 24 May. You have raised an important issue about inadequate disclosures by the boards of directors of companies in India. Perhaps, the situation elsewhere is not very different. My experience is that the minority shareholders are simply ignored. There is very little inclination to provide good information on matters such as sale of businesses, mergers and de-mergers and other important decisions taken by the boards. It is pertinent to point out that the paragraph on risk management aspects in the corporate governance report, now a mandatory feature in a board’s annual report to its shareholders, reveals very little about the business risks faced by the company. Obviously, reforms are urgently needed.
—Narendra M. Apte
I read your article, “The man who placed India on the fossil map of the world”, by Jacob P. Koshy on Ashok Sahni, a silent contributor to India’s palaeontology scene, Mint, 18 May. It was one of the most refreshing and inspiring articles I have read in a while. I am a business management student in Germany. I find newspapers often carry articles that are relevant but boring, or interesting but irrelevant. But this article is an ideal example of information that is both relevant and interesting.
S. Narayan has raised a couple of interesting issues in “Where’s the fault line”, Mint, 28 May. First, the PM has articulated a serious concern that is also being expressed across the world. Shareholders deserve to be aware of the underpinnings of the high salaries of CEOs. Maybe many deserve it. Others may not. There are a considerable number of cases of fraudulent siphoning of profits. CEO and other top management salaries should be a part of disclosure norms for the protection of investors. Investor lobbies abroad are very strong and shareholders are able to correct the wrong actions of company boards. In India, the reverse is true! Investors need protection.
Second, the PM had commented on the widening gulf between the haves and the have-nots. The present, as well as the previous, governments and the Opposition, seem to be bereft of ideas on how to bridge the gap. All they do is pontificate on the advisability of doing so and the only suggestion the PM seemed to offer is, ‘reduce show and pomp’. This seems to be more of a politically correct statement in the aftermath of the recent election rout.
Freeing industry will only help employment. The Wal-Marts, etc. are needed. Organized distribution will enhance organized farming and village production.
I would like to thank your paper for offering us this opportunity to express ourselves. Kudos for an excellent newspaper.
The PM’s call to India Inc. to trim salaries of top executives is shocking since economics, which forms his background, doesn’t suggest controls for dealing with socio-economic disparity. In fact, if each aspect of top-management packages in the government or public sector is monetized, these can be far more than what top executives earn on an average. For example, bureaucrats in the central government live in bungalows that would cost a market rent of Rs2-3 lakh per month, but are typically charged a negligible fee. Official cars are used for personal purposes.
What about the dedication and effort put in by a person to reach the top level in a private firm, even at the cost of his family affairs? In a free economy, let the remuneration be determined by the law of demand and supply. If individuals choose jobs that let them earn as high as they possibly can, it will be in the interest of society and the nation. The earnings incentive will encourage youngsters to work hard.