ICSI to develop corporate governance rating model

It has been reported by the Hindu Business Line [see here] that the Institute of Company Secretaries Institute (ICSI) of India is planning to develop a model of corporate governance rating. In doing so, the Institute plans to build on its existing insights and exposure to governance practices in terms of the Corporate Governance awards that it has been giving for the last 12 years. According to the newly elected President of the Institute, S. N. Ananthasubramanian, “All the collective wisdom will now be tapped to develop our own rating model for corporate governance.” It is noted that this move is coming shortly after the Securities Exchange Board of India (SEBI) released a draft consultative paper on the issue. In the draft paper, the market regulator has said only credit rating agencies may be allowed to undertake corporate governance rating. However, the Institute’s President indicated that ICSI may approach SEBI to permit “even others” to do the rating. This certainly is an interesting development; and perhaps a pointer to similar Institutes in other jurisdictions.

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