Pursuant to the issuance of the Companies (Prospectus and Allotment of Securities) Second Amendment Rules, 2023, with effect from September 30, 2024, both public and private limited companies are required to convert the existing shares and issue new shares exclusively in dematerialised form, bringing an end to physical share certificates. While this seems like a small change, this post seeks to trace the transformation of ‘dematerialisation’ from a progressive and secure option for security holders to a compliance requirement, signifying an increased and progressive threshold of regulation. The post also highlights the key challenges that companies and investors may face with this change.Continue Reading Enforcing progressive compliance: Push for digitalisation by dematerialising shares of all Companies
Associate in the Technology, Media and Telecommunications (TMT) Practice at the Bengaluru office of Cyril Amarchand Mangaldas. He can be reached at firstname.lastname@example.org
Increasing the role and relevance of ‘Proxy Advisory Firms’ in corporate governance
Until very recently, the recommendations of proxy advisory firms did not impact companies much, as it did not have the power to influence or fail/ stop a resolution from being passed. However now, the recommendations of proxy advisory firms are becoming increasingly relevant given that many institutional investors are basing their positions while voting on resolutions on such advice. This is evidenced from the fact that a proxy advisory firms have recently managed to prevent a resolution for granting employee stock options to employees of a group entity of a very large Indian bank from being passed due to the absence of “any compelling reasons”. In another interesting case, a proxy advisory firm came very close to preventing a resolution pertaining to an increase in the remuneration of a director from being passed on account of this increase being “skewed” and “guaranteed”.Continue Reading Impact of Proxy Advisory Firms: Turning tides and failing resolutions
The journey to a new general data protection law in India is more than a decade long and has seen several milestones ranging from the reports of Committees headed by Justice A.P. Shah, Justice B.N. Srikrishna, and a Joint Parliamentary Committee (“JPC”) to draft legislation in 2018, 2019 (“PDP Bill”) and 2021 (“DPB”).
While the recent withdrawal of the PDP Bill is seen as a sign of a long and twisted road ahead, regulators in sectors such as banking, financial services and insurance have not had the luxury of taking the scenic route.Continue Reading The RBI’s Digital Lending Recommendations: A Sign of the Road Ahead?