International Integrated Reporting Council response to the SEBI Kotak committee report on corporate governance

Securities and Exchange Board of India (SEBI) released the report of the committee on corporate governance on 6 October 2017. The International Integrated Reporting Council (IIRC) welcomes the Kotak committee report which is aimed at enhancing corporate governance standards in Indian companies by proposing changes in disclosures, transparency, board composition and performance.

Corporate reporting is an essential and inseparable part of corporate governance – it is the outcome of a corporate governance process – reflecting on the behaviours, from the board and management team, through the business. Integrated Reporting <IR> is fast becoming the information architecture that connects corporate governance and investment stewardship.

In Feb 2017, SEBI released a circular stating <IR> framework be adopted on a voluntary basis by top 500 companies in India. The framework enables companies to make relevant disclosures and encourages guidance pertaining to mid and long term strategy and outlook. It also pushes for boards and management to embrace the concept of stewardship and work towards building shareholder trust.

The India lead for the IIRC, Vrushali Gaud, believes that, “The Kotak committee advances the vital argument that corporate governance is an integral part of the broader governance of the country. The report is evidence based, demonstrating how sound corporate governance leads to significantly greater returns. With reporting becoming an essential tool for demonstrating a company’s commitment to the highest standards of corporate governance, we look forward to working with SEBI and the many leading Indian businesses that are starting to adopt Integrated Reporting to build a secure, successful and sustainable corporate environment for the future”.

The IIRC is a global coalition of regulators, investors, companies, standard setters, the accounting profession and NGOs. The coalition is promoting communication about value creation as the next step in the evolution of corporate reporting. Championed by Indian market leaders including Tata Steel, WIPRO, Infosys, Yes Bank, Reliance Industries as well as Mahindra and Mahindra, the call by SEBI is expected to see a big boost in the number of Indian companies moving towards Integrated Reporting in the next year. To learn about IIRC and the <IR> framework please visit: integratedreporting.ifrs.org