New Delhi, Mar 26 (IANS): State-run firms will now have to compulsorily follow corporate governance norms as per a government decision Thursday.
"The guidelines have now been made mandatory and are applicable to all central public sector enterprises (CPSEs). The guidelines cover issues like composition of board of CPSEs, audit committee, subsidiary companies, disclosures, code of conduct and ethics," said an official statement.
The guidelines were first introduced in June 2007 and were modified as per the feedback received during the experimental phase and includes additional provisions relating to monitoring the compliance of guidelines by the CPSEs and formation of remuneration committee.
"There was a continued need to adopt and apply the good corporate governance practices in respect of CPSEs where huge public funds are invested in the light of recent events in the corporate world," said the statement.