August 10, 2011
PRESS RELEASE
ICSI POWER BREAKFAST on ‘CORPORATE GOVERNANCE &INTEGRITY’
‘Integrity is the foundation on which all other avenues are built’ said Hon’ble Justice R C Lahoti, Former Chief Justice of India at Power Breakfast on “Corporate Governance and Integrity” which was the first event of the ‘First ICSI Corporate Governance Week’ jointly held by Institute of Company Secretaries of India (ICSI) and Transparency International India.
Justice Lahoti said that corporates are expected to imbibe nobility as a trait of their structure and character. He added further that looking at the role which has come to be assumed by the corporates, it is expected that they have conscience and consciousness. He emphasized on creation of right environment by creating ethical climate and setting the organization culture. He said that the spate of scams recently unearthed in US and India, all point to one factor- ‘lack of integrity.’
“Personal integrity is the foundation required for business success in the long term. It’s impossible to have business integrity without personal integrity. Quintessence of integrity is righteousness, transparency and truth. It is the key to success as it creates lasting impact which, in its turn, creates permanent bondage in every relationship (employer – employee, vendor-customer, managers at different levels and every one the man of integrity interacts with). It earns respect and commands following” said Justice Lahoti.
He said that Corporate governance has four basic elements: one, that from managing directors to employees at all levels have to do their duty, as per law and as per their conscience; two, independent directors have to be independent not just for name sake.Three, professionals like company secretaries, auditors have to perform their task and do their duty as a custodians of not only the stakeholders but of the society in general. Lastly, beyond state laws and regulations every person is incharge of his own ethical standards and integrity.
Towards the end he said that the ideal corporate governance is to create a corporate consciousness which leads to serving the society and dispensing welfare to stakeholders.
P.S. Bawa, Chairman Transparency International India, on the occasion complimented ICSI for its governance initiatives and referred that ICSI is an engine which guides the organisations and contributes invisibly for better governance. He discussed at length the objectives and various existing tools like Integrity Pact and emerging tools like Integrity Pledge developed by Transparency International to fight corruption. While elaborating on Integrity Pact he said that Integrity Pact is a tool to fight corruption in procurement by PSUs and added that the vendors are also covered by the Pact. He concluded by saying “Ethical Companies have a better base line”.
On the occasion Prof. A. K. Jain, IIM Lucknow, in his address said that automation and human element have to work in tandem to prevent frauds. Referring to a survey of top 100 companies in India and Germany, he highlighted that 90% of top 100 companies in India do not have explicit Risk Management policy incorporated in the system, whereas in 80% companies in Germany have an explicit policy for the same. He emphasized on having a strong and effective mechanism of whistle blowing and technological based fraud detection.
Nesar Ahmed, Vice President in his welcome address referred to the concept of trusteeship propounded by Mahatma Gandhi and said that once this concept is imbibed then no body is an owner and every one works as trustee of the resources of the society. He further added that ICSI has released an Exposure Draft on Vision 2020 and urged all present to send their views on the same.
N K Jain Secretary& CEO while wrapping up the session said that for a successful business it makes sense to follow the principles of integrity. He added that with regard to human interventions, ICSI is working towards revision of syllabus which shall cover honesty, integrity, sincerity and other ethical traits required in a true professional. Towards technological interventions he pointed that corporate compliance management is an important tool in the hands of professionals. Secretarial Audit is another tool, he mentioned. He further added that institute is working in close collaboration with Global Reporting Initiative(GRI), organization for economic cooperation and development(OECD), Global Corporate Governance Forum(GCGF), International Corporate Governance Network (ICGN) to name a few, to promote good corporate governance practices amongst corporates.
At the interactive session crux that emerged was that the ethical culture is built in an individual during his childhood which later develops into an ethical trait. In this context secular ethical education should be imparted at the school level.
Dr. Amita Ahuja
Senior Director
(Public Relations & Corporate Communication)
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