Narayan murthy committee

report
Priya soni.
Rajmokshith Shetty.
Suraj maurya.
N.R.Narayana murthy.

 Nagavara Ramarao Narayana Murthy (born 20 August 1946), commonly

referred to as Narayana Murthy, is an Indian IT industrialist and the co-
founder of Infosys, a multinational corporation providing business consulting,
technology, engineering, and outsourcing services. Murthy studied electrical
engineering at the National Institute of Engineering, University of
Mysore, and MTech at the Indian Institute of Technology Kanpur.
 Murthy has been listed among the 12 greatest entrepreneurs of our time
by Fortune magazine.He has been described as Father of Indian IT sector
by Time magazine due to his contribution to outsourcing in India.[14] Murthy
has also been honoured with the Padma Vibhushan[15] and Padma Shri awards.
Narayan murthy committee

 the financial statements of companies and the reports on corporate

governance, SEBI observed that their quality was not uniform.
 SEBI thought of reviewing the existing code of corporate governance. It
called for SHRI NARAYAN MURTHY for the same, thus a committee was set
up under him.
 SEBI wanted to review the performance of corporate governance and bring
more of transparency and integrity about the market within the companies
 So SHRI NARYAN MURTHY set on his given task laid down some mandatory
and non-mandatory recommendations
Mandatory recommendation

 Audit committee of each PUBLIC LISTED companies should review their : •

Financial statements and draft audit reports, including quarterly/half yearly
information. • Management discussion and analysis of financial condition and
the results of operations. • Report relating to compliance with laws and risk
management. Management letter/s of internal control weaknesses issued by
records of related party transactions which should be formally approved and
rectified by the Audit Committee
 Proceeds from initial public offerings: • The companies raising money through
initial public offering, should disclose to the audit committee the
uses/application of funds under major heads on a quarterly basis
To be continued

 Risk Management: • Its necessary for the company to know their Risks involve
as there are many stakeholders and shareholders who invest in and expect
from the company. •Every quarter, documenting the business risks faced by
the company, measures to address and minimize such risks, and any limitations
to the risk taking capacity of the firm should be approved by the BOARD.
 Moving to a regime providing for unqualified corporate financial statements
 Compensation to non executive directors to be approved by the shareholders
in general meeting
 Requirement of proper disclosures of details of compensation.
 Whistle blower policy to be in place in a company (freedom to company’s
personnel to approach the audit committee without necessarily informing the
superiors if they observe an unethical or improper practice, protection for
the complainant from retaliation etc. Non-Mandatory recommendations
discussed were
 Training of board members Evaluation of non-executive director’s
performance by a peer group comprising the entire board of directors
 When NARAYAN MURTHY reports were submitted to SEBI, It praised him
by saying
 "The suggestion contained in the Narayana Murthy Committee’s report is
more elaborate and this would encourage a meaningful discussion at the board
level periodically and the company will have the benefit of advice from board
members.
 LATER SEBI approved modifications in clause49 of Listing Agreement to give
effect to the recommendations of Shri N.R. Narayana Murthy Committee‘s
report on corporate governance. SEBI issued a circular dated August 26,
2003 to all the stock exchanges in this regard. The revised clause-49 contains
the sub-clause as per the existing clause-49m as well as new sub-clauses and
the provisions of revised clause49 were effective from April 1, 2004
 SEBI issued a circular dated August 26, 2003 to all the stock exchanges in
this regard. The revised clause-49 contains the sub-clause as per the existing
clause-49m as well as new sub-clauses and the provisions of revised clause49
were effective from April 1, 2004
Thank you.