Review of the LODR Regulations proposing amendments to strengthen corporate governance requirements

SEBI has released a Consultation Paper on the Review of the LODR Regulations proposing amendments to strengthen corporate governance requirements, ease the compliance burden and harmonize the regulations with the Companies Act, 2013.

The primary recommendations include:

1. The corporate governance provisions applicable to a listed entity on the basis of market capitalisation, net worth or paid-up capital shall remain applicable and be complied with, irrespective of any change in the same.

2. Compliance with the requirement of formulating and disclosing a dividend distribution policy on the website and in the annual reports of a company shall extend to the top 1000 listed entities based on market capitalization, instead of the present 500.

3. A listed entity shall be said to have complied with the requirement of uploading separate audited financial statements prior to the annual general meeting if – consolidated/unaudited financial statements of the foreign subsidiary are placed on the website of the listed entity (depending on the requirement of the law of the country in which it is incorporated).

Public comments are invited and can be sent before 11th October 2020.