India’s new Companies Act has far-reaching implications for corporate governance and the protection of investors’ interests. Rebecca Abraham reports
Minority shareholders at Maruti Suzuki India, the country’s leading car maker, recently won a victory of sorts. On 15 March the board of directors of the Indian company decided to seek their approval before going ahead with controversial plans to source cars from what is to be a wholly owned subsidiary of its majority shareholder, Suzuki.
Making the announcement Maruti Suzuki emphasized that there was no law requiring it to seek the approval of its minority shareholders, but that it was being done “as a measure of good corporate governance” and as stipulated in section 188 of the Companies Act, 2013.
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