Economy

Help us weed out needless compliances, Sitharaman urges company secretaries

Our Bureau New Delhi | Updated on October 04, 2021

Nirmala Sitharaman,Finance Minister   -  PTI

Help government identify “redundant” and “low value add” compliances:, says Finance Secretary Somanathan

The Company Secretaries Institute must help the government by identifying “unnecessary, redundant or low value compliances” in various laws that affect the corporate sector and telling it how to get rid of them, Finance Secretary T V Somanathan said on Monday.

Finance Minister Nirmala Sitharaman said that Company Secretaries have a big role to play in ensuring “matured compliance”, especially as regards ease of compliance. She called upon them to suggest greater simplicity in corporate compliances.

Also see: India needs 4-5 SBI-size banks to meet growing needs of economy: Sitharaman

“The greater simplicity we can bring into the system is where things work better. The simpler it is, the better it is and compliance itself can be more tempting,” Sitharaman said in her address at the 53rd Foundation Day celebrations of the Institute of Company Secretaries of India (ICSI).

Impact of technology

There has always been an accent for “law abiding wealth creators” to prosper and for such companies to function without compliance being on their shoulders, she said.

“Company secretaries have a bigger role to play, more so when the government wants to ease compliance and opportunities are ever growing because of introduction of technology. Technology can bring in ease, but it also brings certain challenges,” Sitharaman said.

“Opportunities lie ahead of us. Simple compliances also lie ahead of us. Therefore it is right for suggestions to be made by an insider (the finance secretary is a company secretary himself) to seek your (ICSI) help in identifying redundant compliances and suggesting ways to bring in greater simplicity,” she added.

‘Matured compliance’

Sitharaman highlighted that since the global financial crisis , the world is looking for ways to streamline compliance and most often, big scandals have come out for want of “matured compliance”.

Somanathan said that the government is very keen to make life easier for the corporate sector by reducing compliance burden and ensuring few compliances are kept in place

He said that there has been a lot of improvement in the area of corporate governance, but there is more room for it.

Also see: At 87%, fintech adoption in India higher than global average: FM

“My request to you (ICSI) to tell us how we can get rid of unnecessary compliances is counter intuitive as practising company secretaries are those who have to guide these companies through these processes. This is Perhaps not apparently in your interest. But I want you to be exemplary. If country grows at the pace we want it to grow, it will create its own growth opportunity for the profession. You don’t have to rely on unnecessary compliances in order to make your practice thrive,” Somanathan said.

Corporate Affairs Secretary Rajesh Verma said that government has been taking various measures to reduce compliance burden and decriminalise several provisions in company amd LLP law. He said that corporate affairs ministry is now in the process of deploying MCA 3.0, which will use artificical intelligence in big way.

Published on October 04, 2021

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