Corporate Governance must not just remain a requirement under law. It should become an organisation’s culture, says Ninad Kelkar, Company Secretary of 3i Infotech Limited. In a freewheeling chat with Dipta Joshi, he elaborates on how Company Secretaries can help in developing a corporate governance culture
Ninad Kelkar, Company Secretary of 3i Infotech Limited, believes a Company Secretary (CS), a Key Management Personnel (KMPs) under the law, is nothing short of an “Internal Lokpal” for the organisation. After all, the Company Secretary (CS) acts as an ombudsman advising the management against taking arbitrary decisions that could lead to corporate misdoings.
Ninad also advocates Company Secretaries playing a proactive role to strengthen the governance practices since they are privy to all Board deliberations and decisions. “Corporate Governance cannot just remain a requirement under law. It should become a culture in any organization. And a CS can develop such a culture by encouraging the decision makers to opt for decisions which can serve the interest of all stakeholders,” says he.
Passionate about his profession, Ninad’s interest in the Secretarial field was shaped in the late nineties. The new global economic environment along with its new culture of corporate governance and global laws resulted in Indian companies realigning through restructurings, mergers and acquisitions. “The emphasis on the role of a company secretary made it an attractive career avenue for aspirants like me. I was also interested in law, especially corporate laws,” says he.
Ninad joined a legal KPO (Knowledge Process Outsourcing) unit when he stepped out into the field in 2004. He assisted foreign companies (mainly Europe based) in setting up their companies in India and also handled their compliances. Though Ninad was associated with the KPO unit for only a year, it set the tone for his career. He has since been a part of the India chapters of MNCs. At Alstom Projects Limited, he was appointed Secretarial Executive and handled the entire gamut of Secretarial activities. Thereafter, he has been with 3i Infotech Limited, an India based MNC, engaged in the business of software development and IT services. Joining as a Senior Executive, Ninad moved up the ladder to become 3i Infotech’s Company Secretary. He also leads the legal department of 3i Infotech which is a listed company.
“It has been a great journey with a vast repertoire of experiences in this organisation. I have handled multiple foreign bond issuances and institutional placement issues in the Indian and foreign markets besides managing corporate debt restructuring of about US$ 250 million,” says Ninad.
Ninad has also dealt in more than 30 acquisitions in India and overseas markets, divestments and setting up of joint ventures. According to Ninad, “Having spread their wings across global regions, Indian companies have been exposed to the laws of those jurisdictions. Thus compliance with those laws as well as structuring of the group companies is critical today,” No wonder then mergers, acquisitions and restructurings have become a frequent phenomenon in today’s corporate world and company secretary’s role has become invaluable.
With the business and economic environment becoming dynamic, professionals in the Secretarial field are gearing up for the change. In the long run, their role is expected to be much larger than the conventional compliance management and board management.
Achieving success in such an environment will not be easy unless one is sure of oneself. “The basic thing is to realize our interests. One cannot venture into a career unless he has a passion for that field. Then, focused approach, right attitude and hardwork will take you towards success,” he points out.
Ninad wants aspiring Company Secretaries to look beyond the format curriculum and understand the dynamics of the profession. This is especially important since the Companies Act, 2013 has come into force. The 2013 Act has replaced the earlier 1956 legislation in order to make the laws consistent with the changed economic environment in the last 60 years.
The new Act, which Ninad terms as one of the much awaited economic reform in recent times, brings Indian laws in line with similar laws in other global economies. According to Ninad, there are several other positives too. The law not only regulates the functioning of the companies but also promotes a new governance culture amongst the Indian corporate houses. It seeks to broad base the company Boards by stressing on greater role for independent directors and introduction of provision for women directors (mccullough). It lays stress on Corporate Social Responsibility (CSR) activities of the company and sets out the rights of investors, especially minority shareholders by introducing class action suits.
Simultaneously, the stringent penalty and disclosure norms also give more teeth to the regulators to prevent corporate frauds which were witnessed in recent past. Ninad agrees, “The Act is changing the functioning of corporates in India and has helped to restore investor confidence in the Indian corporate which was shaken due to recent corporate frauds.”
However, Ninad proposes relooking into areas and provisions which do not advance the legislative intent of the law by promoting ‘ease of doing business’ in India. “There are some provisions which seem to have been incorporated in reaction to the recent corporate frauds in the economy. Understandably, legislators must take a cue from such instances and incorporate laws to prevent such instances in future, but there cannot be a negative presumption. Such provisions put unnecessary compliance burden on the corporate houses,” says he. He welcomes the recent amendments by the government which have addressed this concern to some extent.
