Corporate Affairs Ministry (MCA) will shortly roll out series of webinars and in-person interactions with Corporate India and professionals as part of efforts to identify and bridge regulatory gaps, if any, a top official said.
“We will have discussions on each and every Act under the Ministry. We will have discussions with stakeholders to see if there are any regulatory gaps or are there some sort of overreach”, Anuradha Thakur, Additional Secretary, MCA and Director-Serious Frauds Investigation Office (SFIO) said during a webinar on the “Future of Corporate Governance: Insights & Perspectives”, organised by Corporate Professionals.
Thakur highlighted that corporate governance is the backbone of any sustainable and ethical business and economy as a whole.
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“Without sound ethical and good corporate governance, we really can’t push the areas of economy that we want to push and have the kind of confidence that investors need and expand to a $ 5 trillion economy”, she said.
Thakur said that bridging regulatory gaps is a multifaceted problem and needs to be continuously dealt with.
“In today’s fast paced corporate landscape, the challenge for corporates is that everything changes so fast. Not only economies are completely coupled together, even within the country technology changes affect us that we have to keep pace in terms of rules and regulations”, she said.
By doing a good collaborative effort to identify and bridge gaps , MCA is trying to set a level playing field so that each professional and business has similar understanding of what the rules and regulations are and the government also understands what the requirements of different stakeholders are, Thakur added.
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She also said that businesses that are accountable must also feel incentivised.
“Swift and speedy action against corporate misdemeanour also promotes corporate governance so that those who go by the book also feel incentivised that those who don’t follow get punished as they should”, Thakur said.
“My assumption is that our goals (ministry and Corporate India) are the same which is to have a higher and more stable corporate governance and therefore more sound principles in which we collectively work”.
Regulatory overhaul
A recent instance where MCA closed the regulatory gap was in respect of investments flowing from countries with which India shares its land border. Towards this end, it has now aligned its company incorporation rules with FEMA so as to ensure that nationals of a country which shares land border with India do not get to incorporate a company in India without requisite security clearance from the Home Ministry.
MCA now plans to revamp its company law rules and seek public input in alignment with the Finance Minister’s Budget announcement this year.
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The initiative aims to improve regulation in the areas overseen by MCA and simplify compliance. The MCA intends to complete these stakeholder consultations by this fiscal year-end, utilising both online feedback and in-person stakeholder events in various cities.
The proposed MCA move to go in for public consultations is in line with the Finance and Corporate Affairs Minister Nirmala Sitharaman’s budget speech this year wherein she announced that public consultation, as necessary and feasible, will be brought to the process of regulation making and issuing subsidiary directions.