The Hindu Business Line : `Govt not to regulate salaries of private co executives'

NO SALARY CAP: (From right) The Minister for Company Affairs, Mr P.C. Gupta; the Assocham past President, Mr Anil K. Agarwal; and the Assocham President, Mr V.N. Dhoot; at a conference on `Corporate governance & financial reporting norms' in the Capital on Monday. — Ramesh Sharma

New Delhi June 25 The Ministry of Corporate Affairs has clarified that the Government does not intend to regulate salaries and other benefits given to directors and executives of private companies.

Speaking at a seminar organised by Assocham here on Monday, the Corporate Affairs Minister, Mr Prem Chand Gupta, said: "There is no intention on the part of the Government to regulate remuneration of directors and top executives of companies."

The decision on salaries of top functionaries of the companies is left to their boards and shareholders, he said.

"There is no need to regulate remuneration of directors of companies and there is no intention to do so," the Minister said.

Independent directors

He said that the number of independent directors on boards of listed companies will not be allowed to exceed 33 per cent of their total strength against 50 per cent as is being mandated by Securities and Exchange Board of India.

Special provisions are being incorporated in the amended Company Law Bill to restrict the number of independent directors in listed companies to 33 per cent to let the corporate board function in absolute autonomy, Mr Gupta said.

He, however, said that the Corporate Affairs Ministry has deferred introduction of the amended Company Law Bill to the winter session of Parliament, as it would not be possible to place it in the forthcoming monsoon session due to various inter-governmental formalities, which will take time for completion.

The Minister also said that the UPA Government has implemented its e-governance programme known as MCA 21, which has started showing positive results as it has made life easier for corporates and professionals as a result of which tax compliance has improved by more than 50 per cent with substantial increase in Government's revenue.

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