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Wednesday, Sep 08th
Press Release"Corporate governance must go beyond shareholders" The Hindu, Business Line, Kolkata, December 29, 2001 CAN there be a convergence of corporate and public governance? This question reflects the core of a discussion that is being masterminded by Dr. Madhav Mehra, President of World Council for Corporate Governance, on a national scale.Kolkata, on Friday, played host to a seminar that discussed, as Dr Mehra put it, "the power of collaborative governance", from where a number of gems rolled out. And the city's management cognoscenti lapped them up.
Western models of corporate governance, it was pointed out, were mostly based on maximization of shareholder value - a theory that was not entirely applicable to the world. Indeed, employees, whose knowledge accounted for 70 per cent of corporate assets, must be made part of any governance system, it was felt.
Governance, in other words, must not focus merely on shareholders. According to the Centre for Corporate Governance, it must also consider customers and employees who commit their lives for the corporation.
"Traditionally speaking, the constitution of a company's board of directors is confined to its shareholders. The aim here is to maximise their value," said Dr. Mehra. In the current knowledge economy, however, such a policy could lead to a conflict of interest between stakeholders and employees.
A modern corporation, therefore, must create wealth for all stakeholders, including employees, suppliers and customers.
Despite all efforts at alleviating poverty, a large part of the world population was still below the poverty line, while deprivation and poverty were set to become the greatest threat to business and industry.
Therefore, business must involve all sections of stakeholders in working out the right strategies for collaborative governance.
The events that took place on September 11 in the US had changed the world to the extent that people wanted a "complete lifting of the veil of secrecy" in their financial system.
As the Centre put it, there was a lesson in this for corporate in the context of globalization, the latter must help bridge the gap between winners and losers.
Dr. Mehra's initiative found endorsement from Lord Swraj Paul, Chairman of the UK-based Caparo group of companies. In Lord Paul's words, there was need for transparency and corporate governance in all aspects of life.
"Dr Madhav Mehra is a phenomenon, nothing describes him better."
Ola Ullsten, Former Prime Minister of Sweden at the 8th World Congress on Environment Management, Palampur, 2006"
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Dr Mehra, I just read your commentary on Satyam....You made one of the wisest observations on board failures I've ever read - "It is difficult to understand something when your salary depends on not understanding it".Brilliant!
Ralph Ward, Boardroom Insider
"Dr Madhav Mehra, has played a significant role to bring about a change in the mindset of the corporate world. India will remember him as a great pioneer who foresaw such a need and strove for inculcating a culture of quality in all spheres of activity."
S S H Rehman Executive Director, ITC Group of Hotels
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"I have known Dr Mehra for the last 8 years in my capacity as the Chairman of the Centre for Social Responsibility,..... Chairman of the S.M. Charitable Trust . I am amazed by the energy, enthusiasm and dedication that he brings to every idea he promotes."
P.N. Bhagwati, Former Chief Justice of India
"Rarely does one come across a legend like Madhav Mehra. I have witnessed his dedication everywhere: building community centres for gaddies of Dhauladhar, hospital and school for slum dwellers in Delhi and addressing corporates on the social role of their business."
Dr Sahib Singh, Ex-Chief Minister, speaking at SM Medical Centre, 13.04.04"
"Had Dr Madhav Mehra just been the founder of the IOD, that in itself would have been a piece of work tat the present and future generations would cherish. But by establising so many other organisations, he has really ensured that we respect him as a pioneering figure of all te good that Indian business is striving for."
Javed Husain, Professor and former Dean of Engineering
"Address of Dr Mehra was a unique experience. I aspire to listen to him again and wish Dr Mehra can find time to address youth in the colleges."
MK Yadav, Hindustan Zinc LTD
"Dr Mehra has given a unique dimension to CSR. His interpretation is particularly relevant to us and we must invite him once again to address our top executives"
Hon'ble Carlton Davis, head of Jamaica's Civil Service"
"Dr Mehra's passion comes alive from his speeches"
Uma Arora, Chairman Idam Learning
"Dr Madhav Mehra's keynote address was the most thought provoking"
N A Patil & R B Rajpune
CAN there be a convergence of corporate and public governance? This question reflects the core of a discussion that is being masterminded by Dr. Madhav Mehra, President of World Council for Corporate Governance, on a national scale.