NSE launches Prime for companies willing to raise governance bar

The National Stock Exchange (NSE) launched ‘NSE Prime’ on Tuesday – a system that allows listed organizations to pursue higher governance principles than what is needed under the law. They can join deliberately for NSE Prime, which will require them to comply to higher governance standards.

ET had written about December 16 that NSE was hoping to launch a voluntary compliance platform in-line with Brazil’s ‘Novo Mercado’.

“Further developed corporate administration norms, greater transparency and better exposures will assist organizations with building stronger and sustainable businesses that can stand the test of time,” said Vikram Limaye, ND, NSE in a delivery.

A NSE Prime organization needs basically 40% public shareholding as against 25% under the Sebi rules. The executive must be unrelated to the managing director. Board individuals from these organizations can’t serve on the boards of more than five listed organizations.

Commenting on the launch, Kotak Mahindra Bank overseeing chief Uday Kotak said, “Corporate administration is the way to investor trust in corporations. Corporates should have the option to build their essential strategic guardrails alongside transparency on how they operate.