NSE unveils NSE Prime

New Delhi: Leading stock exchange NSE on Tuesday launched a new corporate governance initiative 'NSE Prime' that companies listed on the bourse can adopt voluntarily.

This initiative will raise the bar for corporate governance standards in India, enable investors to identify companies which have voluntarily signed up for higher standards of corporate governance, the exchange said in a statement. In addition, it will broaden the quality of investors in listed companies and further strengthen trust in Indian capital markets, it added.

NSE Prime is a framework that prescribes higher standards of corporate governance for listed companies than those required by regulations, the exchange said in a statement. Additional disclosure requirements have also been prescribed to provide for higher quality of public information and greater transparency.

Listed companies that voluntarily choose to be part of NSE Prime will need to comply with pre-defined norms on an ongoing basis, which will be monitored by the exchange. "Improved corporate governance standards, greater transparency and better disclosures will help companies build stronger and sustainable businesses that can stand the test of time. This will not only help companies and investors, but also accelerate market development at large" said Vikram Limaye, Managing Director and Chief Executive Officer, NSE.

Commenting on the initiative Uday Kotak said corporate governance is the key to investor trust in corporations. Corporates need to be able to build their strategic guardrails along with transparency on how they operate. "Good corporate governance needs business entities to follow standards which are set at a higher level than regulations do! It is one of the best investments that businesses can make, as it lowers the cost of capital and makes business more competitive," T.V. Mohandas Pai said. He, further, said recognising such entities who set higher standards for themselves enables the overall improvement in the business environment.