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In recent years, the concept of non-human directors—entities that are not human but participate in corporate governance—has garnered attention in the evolving landscape of business management. While human directors have traditionally dominated boardrooms, the increasing role of technology, particularly artificial intelligence (AI), robotics, and other non-human systems, is challenging traditional governance models. These advancements could reshape how businesses are governed, but they also present new challenges and opportunities. The Rise of Non-Human Directors A non-human director is typically defined as an entity, whether AI-driven or robotic, that participates in decision-making processes of a corporate board. The involvement of such entities may not always equate to having full voting rights like human directors. Instead, they may serve in advisory roles, providing data-driven insights or performing analyses that human directors can use to make decisions. While no country has yet formally embraced non-human directors as legally binding members with decision-making power, the idea is not as far-fetched as it may seem. AI and Robotics in Corporate Governance Artificial Intelligence (AI) and robotics have found various applications in business, from automating processes to providing predictive analytics. As AI technologies have advanced, some corporations have explored the potential of integrating AI into boardrooms. In these cases, AI systems act as advisory tools, helping human directors make informed decisions based on vast data sets, market trends, and predictive modelling. Notable Examples Rakuten’s AI Director One of the most publicized examples of AI participation in corporate governance comes from Japan’s e-commerce giant, Rakuten. In 2017, the company appointed an AI-powered entity, known as the ‘Robo-Director’, to advise its board. This robot uses machine learning and data analysis to provide strategic insights on business decisions. However, it was explicitly noted that Robo-Director does not have voting rights, but rather, it supports decision-making by analysing data. IBM’s Watson in Boardrooms IBM’s Watson, the company's advanced AI system, has also been used to assist businesses with decision-making. IBM Watson analyses data, helps executives to identify patterns, and provides predictive analysis that can influence business strategies. While Watson is not a director in the legal sense, it acts as a powerful tool for boards to consider during their deliberations. AI at Mitsubishi Corporation Mitsubishi Corporation, one of Japan's largest trading companies, has also experimented with AI in boardroom settings. In these cases, AI analyses large volumes of business data to assist executives and directors in making decisions that are not only financially sound but also aligned with the company's long-term strategy. Legal and Ethical Considerations While the use of AI and robotics in corporate governance is growing, several legal and ethical challenges exist, especially when it comes to allowing non-human entities to participate in decision-making processes. 1. Accountability and Responsibility: One of the major concerns with non-human directors is accountability. Traditional corporate governance is designed around human directors who can be held responsible for their actions. However, AI systems and robots cannot be held liable in the same way. This raises the question of who is responsible if a decision made with AI input leads to a corporate failure, regulatory violations, or financial losses. Should the responsibility fall to the human directors who rely on the AI’s insights, or should the AI itself bear some form of accountability, even though it lacks the capacity to be legally liable? 2. Ethical Issues and Bias in AI: AI systems can analyse vast amounts of data, but they can also inherit biases present in the data they are trained on. If these biases are not carefully monitored, AI could inadvertently make decisions that favour one group over another, leading to ethical dilemmas. For instance, an AI might recommend a cost-cutting strategy that disproportionately affects certain employee groups or customers, all based on data patterns that do not account for social responsibility or ethical considerations. The transparency of AI decision-making processes is also a concern. Unlike human directors who can explain the rationale behind their decisions, AI may function as a "black box," offering no clear insight into how it arrived at a conclusion. 3. Legal Frameworks and Recognition: Most legal frameworks around the world are built on the assumption that directors are human. As such, the concept of a non-human director challenges traditional corporate governance structures. In many jurisdictions, corporate law requires that a company’s board of directors be composed of individuals who are capable of fulfilling fiduciary duties—duties that AI systems cannot legally perform. Further, a non-human director to have formal voting rights, it would require significant changes to corporate law in many countries. Non-Human Directors: The Path Forward Despite the challenges, non-human directors may become more commonplace in the future, especially in advisory roles. Here are a few ways in which AI and robots could transform corporate boards: 1. AI as a Support Tool for Directors: Rather than replacing human directors, AI could serve as a sophisticated support tool, helping them make data-driven decisions. AI can process data faster and more comprehensively than humans, making it an invaluable asset in decision-making processes that require in-depth analysis, such as market trends, financial health, or risk assessments. By integrating AI, boards can leverage technology to enhance their decision-making. 2. Expanded Role in Risk Management: AI’s predictive capabilities can significantly improve risk management practices. Non-human systems can identify potential risks early, providing boards with the foresight needed to mitigate those risks before they escalate. For example, AI could predict market crashes, identify emerging threats to cybersecurity, or even help in crisis management, offering a robust layer of protection for organizations. 3. Hybrid Models of Governance: The future of corporate governance could involve hybrid models, where human directors work alongside AI systems. In such models, AI would be responsible for the heavy lifting of data analysis and decision support, while human directors would still exercise judgment, creativity, and ethical considerations. In these hybrid models, AI would complement human decision-making, not replace it entirely. Global Perspectives: AI and Non-Human Directors Globally, companies are experimenting with AI and robotics in governance to varying degrees. In Japan, the use of AI in advisory capacities is more common, as seen in Rakuten and Mitsubishi. In Europe and North America, the concept is still in its infancy, with companies focusing on the use of AI in operations, customer service, and finance rather than as formal board members. However, the rapid evolution of AI and its growing capabilities could make non-human directors a reality in the not-so-distant future. Conclusion Non-human directors are an exciting prospect in the evolving world of corporate governance. While AI and robotic systems have not yet taken the reins as formal directors, their potential to assist in decision-making is clear. Companies are increasingly relying on AI to process complex data, predict trends, and identify risks, enhancing their governance processes. However, for AI and robotics to become formal directors, substantial legal, ethical, and regulatory changes will need to occur. Accountability, transparency, and bias mitigation will be critical factors to address before non-human directors can be integrated into decision-making processes in a way that is both effective and ethical. The future may see AI and robotics becoming indispensable tools for governance, but the role of human judgment, creativity, and responsibility will remain crucial in steering corporate boards toward success. As the integration of technology into business continues to expand, the role of non-human directors will likely grow, reshaping the very nature of corporate governance as we know it. #robot #nonhumandirector #AI #AIasdirector #corporategovernance #boardmeeting

In today's fast-paced and achievement-driven world, it is common for professionals across various industries to struggle with feelings of inadequacy, self-doubt, and fear of being thought of as ‘inadequate’. These feelings are commonly associated with something known as ‘imposter syndrome’. It is a psychological pattern where individuals doubt their accomplishments and fear being unmasked as incompetent, despite evidence of their success. This article delves into understanding imposter syndrome, its impact on professionals, and, from what I have gathered from reading and researching into the topic, the practical strategies to cope with it. What is Imposter Syndrome? Coined in the late 1970s by psychologists Dr. Pauline Clance and Dr. Suzanne Imes, imposter syndrome refers to the internal experience of believing that we are not as competent as others perceive us to be. It often manifests as a nagging sense of self-doubt, even when there is ample evidence of our skills, talents, and accomplishments. This phenomenon is not limited to a particular gender, industry, or level of success; it affects everyone from entry-level employees to C-suite executives. A 2020 study published in the Journal of General Internal Medicine  found that imposter syndrome is particularly prevalent among younger individuals, especially those in highly competitive fields like medicine, law, and technology. Signs of Imposter Syndrome The following are the common signs of Imposter syndrome: Perfectionism : Setting unrealistically high standards for ourselves and feeling like a failure if we don't meet them. Fear of Failure : Avoiding challenges or taking on new projects due to the fear of not being good enough. Attributing Success to Luck : Believing that our achievements are due to external factors, such as luck or timing, rather than our abilities. Overworking : Compensating for feelings of inadequacy by over-preparing, overworking, or taking on more work than necessary to ‘prove’ our worth. Difficulty Accepting Praise : Downplaying compliments or recognition by attributing our success to others.   Impact of Imposter Syndrome on Professionals While imposter syndrome can be a driving force for some individuals, pushing them to achieve more and be more successful, it often has negative consequences on mental health, job satisfaction, and overall well-being of persons. Here are some of the ways it can impact us professionals: Chronic Stress and Burnout : Constantly striving for perfection and fearing failure can lead to increased stress levels, ultimately contributing to burnout. Decreased Job Satisfaction : When we feel like we are not good enough, it can be challenging to enjoy our accomplishments or feel fulfilled in our role. Stunted Career Growth : The fear of being exposed as a ‘fraud’ [or in other words, what we are perceived to be, but that which we are not in reality] may prevent us from taking risks, applying for promotions, or seizing new opportunities. Impaired Team Dynamics : If we are constantly doubting ourselves, it can lead to difficulties in collaborating with others or delegating tasks, which can impact team performance.   Why Do Professionals Experience Imposter Syndrome? Professionals are often exposed to environments where competition is fierce, and the pressure to perform is high. Here are some factors that contribute to the development of imposter syndrome especially among professionals: High Expectations : Professionals, especially those in demanding fields, often set high expectations for themselves. In addition, those who grew up with academic and extracurricular pressures, may have developed perfectionist tendencies. They often feel the need to excel in every aspect, leading to fears of being exposed as ‘not good enough’ if they make mistakes. Transition Phases : Young professionals are frequently in transition, whether moving from school to the workforce, switching jobs, or advancing to new roles. These transitions can trigger self-doubt as they navigate unfamiliar environments and responsibilities. Lack of Experience : Early in their careers, individuals may feel they lack the experience or skills compared to their more seasoned colleagues. This can lead to feeling unqualified, even if they are competent and capable Social media comparison : The rise of social media has amplified the tendency to compare oneself to others. Young professionals often see curated highlights of others' achievements, which can lead to feelings of inadequacy and self-doubt. Cultural and family background : Individuals from backgrounds where success is highly valued may internalize the need to excel, leading to a fear of failure. Workplace environment : A lack of diversity, inclusive leadership, or support can make it harder for professionals to feel validated and confident in their abilities.   Strategies to Cope with Imposter Syndrome Overcoming imposter syndrome is a journey that involves recognizing, challenging, and reframing one’s negative thoughts. Here are some effective strategies for professionals to cope with and manage imposter syndrome: 1. Acknowledge one’s feelings: The first step in overcoming imposter syndrome is to acknowledge that one is experiencing it. One must understand that it is a common experience and does not reflect one’s actual abilities. 2. Reframe one’s negative thoughts: One should challenge the negative beliefs one has about self by focusing on facts rather than feelings. When questioning about one’s abilities, it is important to remind oneself of one’s achievements, positive feedback, and strengths. A good idea is to actually create a ‘brag file’ to keep track of compliments, awards, and accomplishments to revisit whenever self-doubt creeps in. 3. Stop comparing oneself to others: Comparing oneself to others can fuel feelings of inadequacy. One must remember that everyone has their unique strengths and weaknesses. So, it’s important limit our time on social media or professional networks if they trigger feelings of inadequacy. We should focus on our own growth journey. 4. Embrace failure as a learning opportunity: Instead of seeing failure as a reflection of one’s inadequacy, it is important to view it as a valuable learning experience. Many successful people have experienced failures along the way to their achievements. After a setback, we must write down what we have learned from the experience and how it can contribute to future growth. 5. Talk About It: Sharing one’s feelings with trusted colleagues, mentors, or a coach can help a person gain perspective; it also helps us realise that we are not alone. Often, we end up finding that even those we admire have experienced similar feelings. 6. Set Realistic Expectations: It is important to aim for progress, not perfection. We must understand that no one is perfect, and striving for excellence is different from expecting perfection. A great thing to do in this regard is to set SMART (Specific, Measurable, Achievable, Relevant, Time-bound) goals to help us stay focused and track our progress. 7. Celebrate successes: We must take the time to acknowledge our achievements and celebrate our wins, no matter how small. This helps reinforce a positive self-image and builds confidence. A good idea is to keep a gratitude journal where we can write down three things we did well each day.   Conclusion Imposter syndrome is a common yet often misunderstood experience that affects many professionals, regardless of their level of success. While it can be challenging to overcome, it's important to remember that these feelings are not a reflection of our actual abilities. By acknowledging our feelings, reframing negative thoughts, and embracing our achievements, we can build confidence and resilience in both our personal and professional life. Overcoming imposter syndrome is not about eliminating self-doubt entirely but about learning to manage it so that it doesn’t hold us back from reaching our full potential. We must remember that we have earned our success, and it's time to own it .

A sunshine law is legislation that mandates transparency, openness, and accessibility in government or corporate operations. Primarily used to promote accountability, sunshine laws require public institutions and, in some cases, private organizations (especially those interacting with the government) to disclose certain information to the public. The goal of these laws is to prevent corruption, ensure responsible use of resources, and foster public trust by making processes and decision-making more visible. In other words, sunshine laws are legal provisions that ‘shine light’ on government or corporate activities to prevent corruption, inform the public, and foster trust.   Key Aspects of Sunshine Laws   The following are the main aspects of sunshine laws:   Open Meetings : Sunshine laws often mandate that meetings of governmental bodies or publicly-funded institutions, including government boards, commissions, and agencies where decisions affecting the public are made, be open to the public. Public Records Access : Sunshine laws require that certain records, including financial records, meeting minutes, budgets, contracts, and other documents that show how decisions are made and funds are used, be accessible to the public. Financial Transparency : Sunshine laws often apply to corporate entities that receive public funding or engage in public-private partnerships. These organizations may be required to disclose their financials to ensure they are responsibly using taxpayer money or adhering to ethical standards. Anti-Corruption : By mandating disclosure and transparency, sunshine laws act as a deterrent by helping to reduce opportunities for corruption, bribery, and other unethical practices. Government Accountability : Sunshine laws are intended to increase government accountability by allowing citizens to monitor decision-making processes, giving the public a way to challenge or question decisions that could impact them.   Corporate Sunshine Laws   While sunshine laws traditionally apply to government entities, they also affect corporations, especially in cases where companies have significant public impact or receive government funds. In some jurisdictions, companies are required to disclose information related to public procurement, environmental impact, and human rights practices. So, overall, sunshine laws serve as critical tools in promoting transparency, ensuring that both public and private organizations operate in a manner that respects public trust.   Sunshine Laws in India   India has laws and regulations that serve as sunshine laws by promoting transparency and accountability in government and public administration. While they may not be labelled explicitly as ‘sunshine laws’, these regulations focus on making government actions, spending, and records accessible to the public, reducing opportunities for corruption, and fostering transparency. The following are the key 'sunshine-like' laws and regulations in India:   1.       Right to Information Act (RTI), 2005: The Right to Information (RTI) Act is India’s most prominent transparency law, similar to sunshine laws in other countries. It gives citizens the right to request information from public authorities and compels government offices and agencies to disclose information about their activities, spending, project details and decision-making processes. By mandating government transparency, the RTI Act enables public oversight and reduces secrecy in government functions, which is a hallmark of sunshine laws. The RTI Act applies to all central and state government agencies, including publicly funded institutions and some private organizations that receive substantial government funding. Public authorities are obligated to respond to RTI requests within a set timeframe and to proactively disclose certain categories of information. Public Information Officers (PIOs) are appointed in government agencies to handle RTI requests, and citizens can file appeals if information is withheld without valid reason.   2.       Whistleblower Protection Act, 2014: This law encourages individuals, especially government employees, to report corrupt practices without fear of retaliation. It brings transparency to internal processes by exposing misconduct or unethical actions that would otherwise remain hidden. By safeguarding whistleblowers, the law helps in uncovering fraud and corruption, which aligns with sunshine laws’ goals of shining light on unethical practices and promoting a culture of openness and accountability within public organizations. While it does not explicitly mandate disclosure of government activities to the public, it promotes transparency by encouraging employees to report unethical practices without fear of retribution. The act has certain limitations and is not yet as robust as whistleblower protections in some other countries, but it’s an important step towards transparency.   3.       Lokpal and Lokayuktas Act, 2013 : This anti-corruption law established the Lokpal at the central level and Lokayuktas in states to investigate allegations of corruption among public servants, including high-ranking officials. The Lokpal and Lokayuktas are independent bodies that are empowered to investigate corruption at all levels of government, including top officials and disclose findings, enhancing transparency in government conduct. They act as watchdogs over public officials and help to deter corrupt practices and misuse of power by increasing scrutiny. Their findings and actions are often made public, ensuring transparency in high-level government affairs.   4.       Central Vigilance Commission (CVC) : The Central Vigilance Commission is an independent anti-corruption watchdog that promotes transparency in public procurement and administration and addresses governmental corruption. It conducts investigations, oversees government transactions, and publishes information on cases of corruption. The CVC has made efforts to adopt e-governance practices to enhance transparency, publishing reports, notices of actions, warnings, and corruption cases against corrupt officials on its website for public access.   5.       Public Procurement Policies: To promote transparency in the use of public funds, India has enacted rules requiring competitive bidding and clear procurement processes for government contracts. This helps prevent monopolies and favouritism in government contracts. Public sector tenders are often made available online, and organizations are encouraged to disclose details of contracts and expenditures. The Government e-Marketplace (GeM) platform is a step towards transparency in procurement, providing a centralized online portal for the purchase of goods and services by government departments. It allows citizens to see how public funds are being used, promoting fair competition and minimizing corruption in contract awarding.   6.       National Green Tribunal (NGT) and Environmental Regulations : This Tribunal ensures transparency in environmental governance, allowing public access to environmental impact assessments (EIA) for major projects and other regulatory documents. NGT orders and judgments are made public, promoting accountability in projects that impact the environment. EIAs for large and high-impact projects require public consultations, ensuring transparency and citizen involvement in decisions that affect the environment. The NGT’s requirements align with sunshine laws by providing citizens with the ability to review and challenge decisions that may affect public health and the environment, promoting a more transparent decision-making process in environmental matters.   7.       Mandatory Disclosures under the Companies Act, 2013 and SEBI (LODR) : The Companies Act, 2013 mandates disclosure of certain information for companies, and SEBI (LODR) requires certain disclosures to be made by companies listed on the stock exchanges. This includes financial statements, related party transactions, and director remuneration, ensuring transparency for shareholders and the public. Companies meeting certain criteria are also required to disclose their CSR activities, with a focus on transparency in the use of funds for social projects. All these disclosures are accessible to shareholders and, in many cases, the general public. By enforcing transparency in financial and governance practices, these disclosures promote corporate accountability, ensuring companies adhere to ethical standards and responsible business practices, similar to sunshine law requirements.   8.     E-Governance Initiatives: India has implemented several e-governance platforms to facilitate transparency in public administration, including Digital India (digital platforms for public access to government services, records, and grievance redressal) and MyGov   (citizen engagement platform that allows the public to participate in discussions, provide feedback on policies, and access information on government schemes). These digital platforms offer the public easy access to information and decision-making processes, aligning with sunshine laws by improving public scrutiny, participation, and oversight.   Key aspects of sunshine laws in India   The Indian laws listed above function similarly to sunshine laws because they promote transparency, accountability, and public access to information within government and, in some cases, private entities. While not explicitly termed as ‘sunshine laws’, these Indian laws meet the core objectives of sunshine laws in the following ways:   Increasing Government and Corporate Transparency : By mandating access to public records, open meetings, and corporate disclosures, these laws empower citizens to see how decisions are made and resources are used. Promoting Accountability : By holding government and corporate leaders accountable through oversight bodies (like Lokpal) and disclosure requirements, these laws aim to prevent misuse of power. Reducing Corruption : With transparency and accountability comes deterrence against corruption, ensuring that government officials and corporate executives operate within ethical and legal standards. Facilitating Public Participation : These laws also encourage citizen involvement in governance, especially through RTI and e-governance platforms, empowering the public to influence policy decisions and governance practices.   Challenges and Limitations   The Indian laws mentioned above, collectively promote transparency, accountability, and public access, fulfilling the same essential functions of sunshine laws found in other countries. However, although India has several such transparency-promoting laws, challenges like bureaucratic delays, limited public awareness, and underutilization of certain provisions can impact their effectiveness. Nonetheless, these frameworks collectively work towards enhancing accountability and openness in public administration, aligning with the principles of sunshine laws globally.

In today’s hyper-connected world, every click, post, comment, and share, contributes to our digital footprint. The internet never forgets, and an impulsive post or ill-thought comment can follow us for years, potentially affecting career prospects and personal reputation. To avoid damaging our digital reputation, practicing the mantra ‘Think Before You Click’ is essential. It is today’s version of the proverb ‘Look Before You Leap’. In this article we will have a look at how we can restrict a negative digital footprint and ensure that our online presence enhances, rather than harms, our personal and professional life.   1. Understanding the Impact of What We Share Before posting any content online—whether on social media, forums, or even in emails, we must ask ourselves how it might be perceived by others. Could it be seen as controversial, offensive, or unprofessional? Would we want future employers or colleagues to see it? In many cases, once we post something online, we lose control over how it spreads. So, we must ensure doing the following: Pausing before posting:  Take a moment to re-read or reflect on the message. If it is emotional, controversial, or could be misunderstood, it is better to refrain. Considering one’s audience:  Even on private accounts, content can be shared or screenshot taken. It is wise to assume that anything we post could become public. Avoiding sensitive topics:  One must refrain from posting about topics that are highly divisive, like politics or religion, unless it’s central to one’s personal or professional brand.   2. Limiting Oversharing Personal Information Oversharing details of one’s personal life can make one vulnerable and project an image that may not align with the professionalism required in career. While it's important to show personality, sharing excessive personal opinions, complaints, or intimate details could backfire. We must consider doing the following: Separating personal and professional profiles:  By using different accounts for personal and professional use one can keep one’s personal life more private, and ensure professional presence remains polished and appropriate. Using privacy settings:  On social media platforms, it is important to take advantage of privacy settings to control who can see our posts and personal information. But we must remember that privacy settings don’t guarantee complete privacy. Sharing purposefully:  One must avoid airing grievances, complaints, or personal drama publicly and focus on sharing content that is relevant, positive, and beneficial to all.   3. Thinking Twice About Comments and Engagements Comments, likes, and shares can often seem harmless, but they still reflect our opinions and values. Engaging with controversial or inappropriate content, even indirectly, can harm one’s reputation. One’s online activity leaves traces that can be easily tracked. We must follow these: Avoiding emotional responses:  When angry or upset, one must avoid commenting or engaging with content. Wait, calm down and take time to reflect. Emotional responses often lead to regrettable comments. Being mindful of what one supports:  It is important to think carefully before liking or sharing posts. Supporting or engaging with questionable content, even indirectly, could reflect poorly a person. Being constructive:  When commenting in forums, on social media, or in professional discussions, it is important to ensure one’s tone is respectful and constructive, even when disagreeing with others.   4. Regularly Auditing One’s Digital Footprint It’s important to regularly review what’s out there about us. Over time, old posts, comments, or articles may surface that no longer represent who we are. By auditing our digital footprint regularly, we can clean up content that might harm our current professional image. We may do the following in this regard: Searching our name:  Regularly Googling oneself and checking social media, blogs, and forums where we might have contributed in the past to see what information appears. Deleting outdated or harmful content:  Posts that no longer reflect our values or professionalism, may be deleted or hidden. If unable to delete, the site administrators may be contacted to request removal. Updating old profiles:  One must ensure that the social media reflects one’s current professional standing.   5. Being Aware of Who We Associate With Online Our connections, followers, and friends on social media can influence how we are perceived. Associating with individuals who post offensive or controversial content can reflect poorly on us by extension. Curating one’s connections:  It is important to review our social media connections from time to time and remove or unfollow individuals whose behaviour or content do not align with our values. Engaging with positive communities:  Surrounding oneself with people who uplift, inspire, and contribute to constructive conversations is important. Being mindful of group memberships:  It is important to review online groups we belong to and make sure they reflect our current interests and values.   6. Leveraging Privacy Tools and Settings Most platforms offer tools and settings to control our online visibility. From social media privacy settings to profile visibility options on professional networks, taking advantage of these tools allows us to limit the reach of potentially harmful content. We must do the following: Adjusting privacy settings:  On platforms like Facebook, Instagram, and Twitter, one must review privacy settings to limit who can see our posts, personal details, and interactions. Using two-factor authentication:  For added security, we can enable two-factor authentication on our accounts to protect them from being hacked or misused. Limiting tagging permissions:  It is advisable to control who can tag us in posts and photos so that we can have a control over the same.   7. Being Proactive About Building a Positive Footprint Instead of just trying to avoid negative content, we can actively create positive and valuable content that reflects our skills, expertise, and values. By building a positive digital footprint, we can push down negative content that might exist and ensure that when people search for us, they find information that highlights our strengths. The following are important in this regard: Publishing content that showcases our expertise:  Writing articles, sharing industry insights, or post about achievements on professional platforms like LinkedIn. Engaging in online communities:  Actively participating in industry-relevant forums, groups, or discussions, offering expertise and insights to others. Sharing our accomplishments:  It helps shape a positive and credible online presence.   Professionals must take special care Professionals, while navigating an increasingly digital landscape, must especially beware. Whether it’s social media, blogs, forums, or professional networking sites, the internet plays a significant role in shaping our reputations. Managing our digital footprint is no longer optional; it is essential for career success. Following are the ways in which digital footprint plays special role in the lives of professionals:   A. First Impressions Happen Online   In this age, the first impressions always happen online. Recruiters, employers, and clients often search for professionals online before they ever meet them in person. According to studies, nearly 70% of employers check social media profiles and online activity as part of the hiring process. So, maintaining control of one’s online presence is very important for professionals. A carefully curated and managed online footprint can make sure that the first thing they see aligns with one’s professional persona.   B. Online presence as a personal brand In a world where competition is fierce, having a strong personal brand can help professionals stand out. Our digital footprint is an extension of our personal brand—it tells the world who we are, what we stand for, and how we engage with our industry. By strategically contributing to online discussions, sharing industry insights, and highlighting achievements, professionals can shape their narrative in a way that supports their career goals.   C. Networking Opportunities A well-maintained digital footprint can also open doors for networking. Professional connections are no longer limited to in-person meetings or conferences; online platforms like LinkedIn or Twitter allow professionals to connect with peers, thought leaders, and industry influencers globally. By presenting ourselves well online, we can attract new connections, potential mentors, and even benefit from collaborative opportunities that could enhance our career. We can engage regularly with professionals in our industry, follow the companies we admire or join groups or discussions where we can contribute value and build meaningful connections.   D. Career Longevity in a Digital World As careers evolve, our digital presence will play an increasingly larger role in career development and advancement. Having an established, credible, and authoritative digital footprint can make us more visible to future opportunities and help position us as an expert in our field. Even if we are not actively job hunting, managing our digital footprint ensures that we are always prepared for new opportunities. Therefore, we must regularly update our professional profiles, reflecting new skills, roles, and achievements and be active in online communities relevant to our field.   E. Attracting Global Opportunities In a world where work is becoming increasingly remote and globalized, our digital footprint transcends geographical boundaries. Employers and clients from across the globe may search for our name when considering us for roles or projects. A well-managed online presence ensures that no matter where in the world one is being considered, the information available about us is consistent and professional. With this in view, one may showcase multilingual skills, international collaborations, or cross-border projects on one’s profiles and engage with a global audience.   Conclusion To sum up, managing one’s digital footprint is crucial in today’s digital age, where online presence often precedes in-person interactions. Taking control of how one is perceived online by ensuring professionalism, authenticity, and consistency across digital platforms will not only help mitigate risks but also enhance one’s career prospects. In the long run, a well-maintained digital footprint can support our personal brand, open up networking opportunities, and ensure that we are prepared for career growth in an ever-connected world. Thus, the saying ‘Think Before You Click’ perfectly captures the essence of managing one’s digital footprint. Every post, comment, and interaction one has online leaves a trace that can shape one’s reputation for years to come. By being mindful of what we share, where we click, limiting exposure to inappropriate content, auditing one’s online presence, and taking proactive steps to build a positive footprint, one can protect one’s reputation and ensure one’s digital footprint enhances their personal and professional life.

It is said that the people we spend the most time with, influence the topics that capture our focus and the attitudes and behaviours we are consistently exposed to. Over time, this can lead us to adopt our way of thinking and acting. This theory is based on the famous quote by motivational speaker Jim Rohn “You are the average of the five people you spend the most time with” . It suggests that the people in our closest social circle significantly influence who we are, how we think, and how we behave. The idea is rooted in the broader psychological principle that our environment shapes us. Key Points of the Theory The theory around this quote can be broken down into the following connotations: Mindset: The people around us shape our mindset. If we surround ourselves with positive, growth-oriented individuals, we are more likely to adopt a similar attitude. Conversely, negative or pessimistic people can encourage a restricting mindset. Behaviour: We tend to mimic the behaviour of those we spend time with. If our circle is composed of hardworking, disciplined people, we are more likely to adopt those traits. On the other hand, if our group is prone to procrastination or unhealthy habits, those behaviours may rub off on us as well. Values and Habits: The people who stick together often share similar values and habits. Spending time with financially responsible, health-conscious, or intellectually curious people will likely make those values a part of one’s own identity. Emotions: Emotions and moods are contagious. Being around motivated, and emotionally stable people can boost our own emotional state, while those who are chronically negative or stressed can bring our energy down. Social Standards:  We subconsciously adopt the standards and expectations of our peer group. If those around us have high standards in terms of personal success, integrity, or relationships, we will be pushed to meet those standards. Implication for professionals As a professional striving for career growth and advancement, this idea resonates deeply. In today's competitive and fast-paced work environment, the people we surround ourselves with can have a profound impact on our mindset, behaviour, and ultimately, our success. Here’s why this theory is particularly relevant for those of us seeking to elevate our professional lives: Mindset: If professionals surround themselves with goal-oriented, motivated professionals, they are more likely to adopt the same hunger for success. Spending time with high achievers fosters a growth mindset, pushing them to constantly improve, set higher goals, and remain resilient in the face of challenges. Behaviour: In the workplace, people often mirror the behaviours of those around them. If our peers are diligent, focused, and efficient, these qualities naturally influence our own approach to work. Associating with people who are consistently productive, who prioritize personal development, or who take calculated risks can push us to elevate our own standards of performance. Values and Professional Habits: The professional habits and values of our closest colleagues play a significant role in shaping our own. If we network with people who are dedicated to continuous learning, personal accountability, and financial discipline, those traits will inevitably permeate into our own behaviour. Conversely, if we’re frequently in the company of individuals with a complacent attitude toward work, we may get stagnated. Emotional Influence and Motivation: Positive influences keep us energized and solution-focused, even during high-pressure situations. In contrast, if we regularly associate with people who are negative or unmotivated, it can dampen our enthusiasm and drain our energy. Professional Standards and Peer Expectations: If professionals are part of a circle that consistently strives for innovation, leadership, and integrity, they will naturally hold themselves to the same high standards. In contrast, being part of a group with lower professional standards can lead to complacency and missed opportunities for advancement. Practical Applications for Career Growth Professionals who desire to excel in their careers, the following are some areas of practical application of this theory: Networking with High-Achievers:  For professionals aiming for career advancement, it is crucial to network and build relationships with those other professionals who have already achieved the same. The latter’s success can offer valuable insights and guidance, and their presence can inspire the former to push beyond their comfort zone. Surrounding oneself with Lifelong Learners:  A commitment to continuous learning is key to staying relevant in any industry. By aligning oneself with individuals who prioritize learning and skill development, one will naturally be motivated to invest in one’s own growth, whether through formal education, certifications, or on-the-job experiences. Seeking Out Mentors and Role Models:  Having mentors who embody the career success and leadership one aspires to achieve is invaluable. Their experience and advice can provide direction, their success can serve as a tangible reminder of what’s possible with the right mindset and effort. Emotional and Psychological Well-Being:  For mental well-being, it is important to surround oneself with emotionally supportive and stable people. Negative influences can contribute to stress, anxiety, or self-doubt. Career and Financial Success:  In professional settings, networking with successful, driven individuals tends to provide insights, resources, and opportunities that wouldn't come from those who lack ambition. Summing up: The Power of Choice While this theory emphasizes the impact of social influence, it is essential to remember that as professionals, we have the power to choose who we spend our time with. By consciously selecting peers, mentors, and colleagues who push us toward excellence, we set ourselves up for faster career growth, deeper learning, and more fulfilling professional relationships. Ultimately, the key to career advancement is not only in the skills we develop but also in the environments we create. By surrounding ourselves with the right people, we align ourselves with the attitudes, behaviours, and standards that propel us toward success.

Dussehra, also known as Vijayadashami (or Bijoya Dashami), is a major Hindu festival that celebrates the victory of good over evil. It marks the defeat of the demon king Ravana by Lord Rama in the epic Ramayana, symbolizing the triumph of righteousness and truth. The festival also honours Goddess Durga's victory over Mahishasura, the buffalo demon. Dussehra or Vijayadashami is celebrated all across India in various ways, including cultural performances, vibrant processions, the burning of effigies of Ravana, distributing sweets, taking blessings of elders, and more. But it is more than just a festival. It signifies the importance of courage, morality, and the destruction of inner evils like ego and greed. The festival encourages self-reflection and promotes values of virtue, humility, and righteousness. There are valuable lessons to learn from this festival, and these lessons transcend religious boundaries and offer valuable insights applicable to everyone, regardless of one’s faith or cultural background. Here are 10 most valuable lessons that we can learn from the festival of Dussehra:   1. Triumph of Good Over Evil The festival symbolizes the victory of good over evil, embodied by Lord Rama’s triumph over the demon king Ravana. This story reminds us that no matter how powerful or dominant evil may seem, it is always temporary. In life, situations may arise where wrongdoers seem to succeed, but Dussehra teaches us that the truth and righteousness will ultimately prevail. The moral of the festival inspires individuals to choose good over evil in their personal lives, knowing that integrity and virtue are enduring, powerful forces. 2. The Importance of Courage Dussehra brings to light the importance of courage and moral strength. Lord Rama’s decision to confront Ravana and engage in a fierce battle, despite the odds being against him, is a reflection of true bravery. His actions inspire us to gather the strength to face our personal battles and life challenges with courage. Whether it's standing up for justice or fighting internal fears and doubts, courage allows us to stay committed to righteousness. The festival reminds us that we can overcome any obstacle when we fight for the right cause with determination. 3. Self-Discipline and Patience Lord Rama’s life throughout the Ramayana demonstrates profound self-discipline and patience, two virtues that are key to personal and spiritual growth. His 14-year exile in the forest, endured with grace and patience, serves as a model of how we should handle difficulties in life. Rama’s unwavering focus on his duties, despite his hardships, teaches us the value of persistence and control over desires. Dussehra encourages us to develop these qualities in our own lives, reminding us that success is often the result of consistent effort and patience in the face of adversity. 4. Respect for Relationships The relationships in the Ramayana, that between Lord Rama and Sita, between Rama and Lakshmana, and that between Rama and Hanuman, all showcase the importance of love, loyalty, and mutual respect. Rama’s dedication to Sita, his commitment to his brother, and the unwavering devotion of Hanuman to his Lord, are all examples of the deep bond and responsibility we must nurture in our relationships. Dussehra reminds us to value and honour our family and friends, as these relationships provide strength, support, and guidance during difficult times, helping us navigate life’s challenges. 5. The Consequences of Ego and Pride The Ramayana tells us how pride and ego brought about Ravana’s downfall. Despite his vast knowledge and power, Ravana’s arrogance led him to make poor decisions, including abducting Sita. His refusal to listen to wise counsel and his inflated sense of self-worth ultimately caused his destruction. This teaches us the importance of humility, self-awareness, and listening to advice. Blinded by ego people are unable to see the truth and make the right choices. Dussehra reminds us to remain humble and grounded, no matter how much we achieve in life. 6. Empowerment of Women The victory of Goddess Durga over the demon Mahishasura during Dussehra is a powerful symbol of women’s strength, courage, and wisdom. It highlights that women possess immense power and are capable of great leadership and protection. This story urges society to respect and honour women, recognizing their contributions not only as caregivers but as warriors, leaders, and sources of inspiration. The empowerment of women is a critical lesson of Dussehra, reminding us to support gender equality, create opportunities, and appreciate the unique strengths women bring to all aspects of life. 7. The Power of Knowledge Ravana, despite being one of the most learned persons of his time, misused his knowledge for selfish purposes, leading to his eventual downfall. This teaches us that knowledge is a powerful tool that must be used with wisdom and moral integrity. Without these guiding principles, intelligence can become destructive. Dussehra imparts the lesson that while gaining knowledge is important, it is equally crucial to use it ethically and in ways that benefit others. True wisdom lies in applying knowledge for the greater good, promoting peace, harmony, and justice. 8. Forgiveness and Compassion One of the lesser-known aspects of Dussehra is Lord Rama’s display of compassion and forgiveness. Before killing Ravana, Rama offered him several opportunities to repent and surrender. This shows that even in the face of wrongdoing, offering a chance for redemption is a virtuous act. Forgiveness and compassion, often seen as signs of strength rather than weakness, are essential for personal and societal harmony. Dussehra teaches us to cultivate these qualities in our own lives, as they allow us to heal, move forward, and contribute to a more peaceful world. 9. Sacrifice and Duty Dussehra also highlights the theme of sacrifice and the importance of fulfilling one’s duties. Lord Rama sacrificed his personal desires, leaving behind the comforts of his kingdom to honour his father’s word. Sita and Lakshmana also made significant sacrifices to accompany Rama in his exile. These acts demonstrate that sometimes we must give up our own comfort for the greater good or to uphold our responsibilities. The festival teaches us that performing our duties with dedication and selflessness, even when it involves sacrifice, is the mark of true character. 10. The Importance of Spiritual Growth The burning of Ravana’s effigy during Dussehra symbolizes the destruction of inner demons like ego, anger, greed, and jealousy. It serves as a reminder that spiritual growth involves constant self-reflection and a conscious effort to overcome these negative traits. Dussehra encourages us to embark on a journey of inner transformation, where we actively seek to become better versions of ourselves by identifying and eliminating our flaws. The festival provides an opportunity for introspection, reminding us that true victory is not just over external enemies, but also over the evils within.   These lessons from Dussehra help us reflect on how to live a life of virtue, humility, and courage, and constantly strive for self-improvement. In essence, Dussehra imparts timeless values that resonate universally, encouraging individuals to lead lives marked by virtue, resilience, and compassion. These lessons are integral to personal development and societal well-being, making them relevant and beneficial to people of all backgrounds.

In a world increasingly defined by relentless productivity, constant work resulting in stress, and ever-growing competition, the importance of taking time to pause, reflect, and rejuvenate has never been more important. Professionals of today have to be alert all the time, keep themselves updated with latest rules and regulations, fulfil the growing demands of clients and yet, take out time for themselves. It is important to stay healthy, and fresh. Niksen, Mindfulness, and Meditation are three distinct practices that encourage us to slow down; each one approaches relaxation and mental clarity from a unique perspective. As stress-related conditions rise globally, more people are turning to these methods to achieve balance and peace. This article is dedicated to the well-being, good health and self-awareness of today’s professionals. Niksen: The Art of Doing Nothing Niksen, a Dutch concept, literally translates to ‘doing nothing’. Unlike other practices that focus on specific tasks like meditation or self-awareness, Niksen invites individuals to engage in activities with no purpose or goal in mind. Whether staring out of a window, daydreaming, or simply sitting idle, Niksen is about letting the mind wander freely without the pressure to produce or be present in any particular way. At first glance, Niksen may seem counterproductive, especially in today’s culture of hyperactivity and ‘workaholism’. Its value lies in giving the brain a chance to rest, process and reset. Niksen taps into our natural need for moments of idleness, providing the mental space to recover, spark creativity, and reduce anxiety. The beauty of Niksen is in its simplicity. There are no techniques or rituals to learn, no mindfulness to cultivate. It is the permission to exist without expectation, to allow the mind to wander aimlessly—an essential practice for those who find structured approaches like meditation overwhelming. Examples of Niksen Staring out the window : Sitting by a window, watching the clouds, birds, or people passing by without any specific goal or focus. Daydreaming : Allowing one’s mind to wander freely without trying to solve a problem or plan anything, simply enjoying the mental drift. Lying on the couch : Relaxing on the sofa, perhaps listening to background noise like soft music, without engaging in any tasks or distractions. Sitting in a park : Spending time in a park or garden, observing the surroundings without feeling the need to engage in conversation or activities. Flipping through a magazine : Casually looking at pictures in a magazine without reading in-depth articles or trying to absorb information.   Mindfulness: The Power of Present Awareness Mindfulness, though often used interchangeably with meditation, is distinct in its emphasis on conscious awareness. Rooted in the Buddhist tradition, it involves actively paying attention to the present moment with a non-judgmental attitude. Whether we are eating, walking, or even washing dishes, mindfulness is about being fully engaged in the activity at hand. It requires us to notice our thoughts, feelings, and surroundings without reacting or getting lost in them. Unlike Niksen, where the mind can drift freely, mindfulness encourages deliberate focus on the ‘now’. In mindfulness, even daydreaming or distraction is observed, not indulged. This practice has been extensively researched for its ability to reduce stress, improve emotional regulation, and enhance overall well-being. Studies show that mindfulness can even alter the brain, thickening areas associated with attention and emotional processing. Mindfulness is particularly helpful in addressing the modern-day tendency to multitask. Instead of rushing through life on an autopilot mode, it offers a way to experience each moment more fully, cultivating a deeper sense of connection with ourselves and our environment. Examples of Mindfulness Mindful eating : Paying full attention to the taste, texture, and smell of one’s food, noticing each bite without distractions like TV or phone. Walking mindfully : Focusing on the sensation of one’s feet touching the ground, the rhythm of one’s steps, and one’s breathing as one walks. Mindful breathing : Taking slow, deep breaths while noticing the sensation of air entering and leaving one’s body, staying present with each breath. Mindful listening : Engaging fully in a conversation, giving one’s complete attention to the speaker, and observing one’s thoughts or reactions without judgment. Body scan : Bringing awareness to different parts of one’s body, noticing tension or relaxation as one mentally scans from head to toe.   Meditation: A Practice of Deep Reflection Meditation is a more structured mental exercise aimed at achieving a heightened state of consciousness. There are many forms of meditation—such as focused attention, loving-kindness, transcendental, and mantra-based meditation—but all involve setting aside dedicated time to cultivate inner calm, insight, or compassion. Unlike mindfulness, which can be practiced anytime during daily activities, meditation usually requires a quiet space and a set period. Meditation is an ancient practice rooted in spiritual traditions like Hinduism and Buddhism, but it has been widely embraced in secular contexts as well. Its goal is often to quiet the mind, attain clarity, and foster emotional balance. Over time, consistent meditation practice can rewire the brain, reducing stress responses, increasing empathy, and enhancing self-awareness. It is a process of returning the mind to a point of stillness, often focusing on the breath, a mantra, or an image to centre one's attention. While mindfulness encourages ongoing awareness in everyday activities, meditation is more of a retreat from activity—a break to reset the mind, allowing practitioners to reflect deeply on their thoughts and emotions. It is often seen as a path toward spiritual growth or psychological healing. Examples of Meditation Breath-focused meditation : Sitting quietly and focusing on one’s breath, using it as an anchor to bring one’s attention back when one’s mind wanders. Loving-kindness meditation : Silently repeating phrases like "May all be happy" while focusing on feelings of compassion for oneself and others. Mantra meditation : Repeating a word or sound (like "Om") to focus the mind and reach a deeper state of concentration and calm. Guided visualization : Closing one’s eyes and listening to a guided audio or video, imagining peaceful scenes or positive outcomes to relax the mind. Transcendental meditation : Practicing twice a day by sitting with closed eyes for 15–20 minutes, repeating a personalized mantra to transcend thought and achieve inner stillness.   Niksen vs. Mindfulness vs. Meditation: Key Differences and Benefits While these three practices share a common thread of slowing down and enhancing mental well-being, they diverge in method and intent. Niksen is the most unstructured of the three. It allows for the freedom to do nothing and to not focus on anything, not even on self-awareness or achieving any state of mind. It's especially suited for those who feel overwhelmed by the constant pressure to be productive and need to ‘unplug’ mentally. The primary benefit of Niksen is relaxation and mental recovery, offering a space for creativity to flourish without any forced engagement. Mindfulness is about intentional awareness. It requires active engagement with the present moment and is ideal for those looking to cultivate greater presence in their daily lives. Mindfulness doesn't demand a pause in activity; instead, it requires us to become fully present during whatever we are doing. Its benefits include stress reduction, improved focus, and emotional regulation. Meditation is a structured or formal practice. It involves deliberate techniques to quiet the mind, increase concentration, and foster inner peace. Meditation suits those seeking deeper mental clarity or spiritual insight, often requiring discipline and regular practice to realize its long-term benefits. It is particularly effective for long-term stress management, emotional healing, and enhancing overall well-being.   Which practice to choose? Choosing between Niksen, mindfulness, and meditation depends largely on personal preference, lifestyle, and the needs of the moment. If one is feeling mentally exhausted  and needs a break from the pressure to perform, Niksen may be the best option. For someone who is looking to increase presence  in daily life and manage stress or anxiety, mindfulness is effective in developing a habit of staying grounded in the present moment. To those who seek deeper emotional or spiritual growth , meditation might be the answer. Its more structured nature makes it a powerful tool for achieving inner calm and insight.   A Harmonious Approach: Blending Practices It is worth noting that these practices don’t need to be mutually exclusive. In fact, they complement each other beautifully. Niksen can serve as a gentle entry point for those new to mindfulness or meditation, offering rest and relief before diving into more active mental practices. Similarly, practicing mindfulness can prepare the mind for deeper meditation by fostering awareness and focus. In a world that often demands too much, finding time for any of these practices can be transformative. Whether through the relaxed idleness of Niksen, the focused awareness of mindfulness, or the deep reflection of meditation, we have multiple paths toward self-awareness, greater peace and clarity.

In recent years, the concept of employee directors, or, in other words, workers serving on the board of directors, has gained popularity in many countries of the west. Employee representation at the board level is not only a radical shift from the traditional shareholder-centric model but also a move towards a more inclusive, democratic, and transparent approach to business decision-making. But while this idea promises to strengthen the relationship between employers and employees, it also raises critical questions about its feasibility, fairness and impact on the company’s performance. In this article, we will discuss this concept, the relevant legal provisions, the pros and cons, and the way forward.   Composition of Board of Directors   Traditionally, corporate boards were composed of directors, whose primary responsibility was to maximize shareholder value. Many companies also had nominee directors and professional directors. The concept of independent directors (IDs) was introduced as part of corporate governance reforms aimed at improving transparency, accountability and oversight in companies. The timeline for the introduction of independent directors varies across countries, but it generally gained prominence in the late 20th century. For instance, in the UK, the concept of independent directors was brought to the fore by the Cadbury Committee Report on corporate governance in 1992. In the US the concept got significant attention in the wake of major corporate scandals like Enron and WorldCom; consequently, the Sarbanes-Oxley Act of 2002 mandated public listed companies to have independent directors on their boards. Prior to this Act, having IDs in the Board was part of corporate best practice only. In India, the concept was introduced in 2000 by Clause 49 of the Listing Agreement that was implemented by the Securities and Exchange Board of India (SEBI). In the European Union also, in the wake of major corporate scandals, the need for independent directors became a key aspect of corporate governance reform in the early 2000s. Similarly, in Australia, the role of IDs became more formalized with the release of the ASX Corporate Governance Council's Principles of Good Corporate Governance and Best Practice Recommendations in 2003.   Employee directors   While the inclusion of independent directors helped drive transparency and efficiency, it has also been criticized for neglecting the interests of an important stakeholder, the employees. The idea behind employee directors was therefore introduced to bridge this gap, giving workers a voice in boardroom discussions and ensuring that their interests are directly represented at the highest levels of decision-making.   Employee directors can act as a bridge between the management and workmen and thereby help align the interests of both the parties. First, they bring an inside perspective to the board, providing valuable insights into the company's operational and cultural dynamics. Employees have a deep understanding of how company policies impact daily work life, and their involvement could lead to more thoughtful, balanced decisions that take into account long-term sustainability rather than short-term profit. Moreover, employee representation can enhance workplace morale and engagement. Having a representation on the board makes them feel empowered, and in turn, motivated, more productive and loyal. This often leads to lower turnover rates and a better organizational culture.   A proven model in many countries   Employee directors on boards is not a recent concept. In fact, many European countries have had worker participation in corporate governance for decades. However, the legal provisions governing employee directors vary significantly across countries, depending on their respective labour laws, corporate governance frameworks, and social models. In some nations, employee representation on corporate boards is mandated by law, while in others, it is voluntary or not practiced at all. Below is an overview of the legal provisions governing employee directors in a few countries:   Germany   Germany is one of the most prominent examples of mandatory employee representation on corporate boards, through a system known as Mitbestimmung (co-determination). As per the Co-Determination Act of 1976, in companies with over 2,000 employees, half of the supervisory board members must be employee representatives. This applies to all large companies, including public listed companies. For companies with 500–2,000 employees, one-third of the supervisory board is made up of employee representatives. These representatives are elected by the workforce and include both regular employees and union representatives. They have equal voting rights as the shareholder-appointed board members, although in the case of a tie, the chairman (a shareholder representative) has the casting vote.   France   In France, employee representation on corporate boards is legally required for large companies. As per the Loi Rebsamen (2015) and Pacte Law (2019), companies with over 1,000 employees in France or 5,000 globally must include at least two employee representatives on their boards of directors or supervisory boards. The precise number of employee representatives varies depending on the company’s size and internal governance structure, but generally, the threshold is two representatives for boards with more than eight members. Employee representatives are chosen either by the workers directly or via labour unions, depending on the company's internal rules. The aim of these laws is to ensure worker input in corporate governance, while also promoting social dialogue between employers and employees.   Sweden   Sweden has a well-established system of employee board representation as part of its broader tradition of labour market collaboration. Under the Board Representation (Private Sector Employees) Act of 1987, companies that have at least 25 employees, are required to have employee representatives on the board. Workers can appoint two representatives if the company has fewer than 1,000 employees, or three representatives if there are more than 1,000 employees. The employee board members have the same rights and responsibilities as other directors, though they are not involved in decisions related to collective bargaining agreements or labour disputes.   Denmark   In Denmark, employee representation on boards of directors is voluntary but becomes mandatory once employees opt for it. As per their Companies Act, companies with at least 35 employees must allow their workforce to elect representatives to the board of directors. Employees have the right to elect one-third of the board members, with a minimum of two seats. The threshold for electing these representatives is triggered when employees initiate the process through a formal vote. Employees elect representatives every four years, and these directors have the same rights and duties as other board members. Denmark’s system allows for flexibility, as employee representation is implemented only if the workforce expresses interest.   Norway   According to the Norwegian Public Limited Liability Companies Act, if a company has between 30 and 50 employees, employees can choose to have one board representative. Companies with more than 50 employees must have one-third of their board seats filled by employee-elected representatives, with a minimum of two representatives. Employee representatives are granted the same rights and responsibilities as other board members, but similar to Sweden, they are excluded from decisions concerning collective labour issues.   Finland   Finland's model provides for voluntary employee representation based on negotiations between employees and management. The Act on Personnel Representation in Company Administration, 1990 (which is now a part of the Co-operation Act of 2021) provides that in companies with over 150 employees, the latter may negotiate with the management to have their representative on the board. The number of representatives is determined through negotiations, and these representatives have the same voting rights and responsibilities as other directors.   Austria   Austria has a similar structure to Germany, with mandatory employee representation in large companies. The Austrian Labour Constitution Act (1974) provides that companies with over 300 employees must allocate one-third of supervisory board seats to employee representatives. These representatives are elected by the works council and have full voting rights, though they cannot vote on issues related to collective bargaining.   United Kingdom   The United Kingdom has no legal requirement for employee representation on boards, but there has been increasing discussion around corporate governance reform in this area. The new Corporate Governance Code of 2018 encourages large companies to engage more with their workforce. One option for doing this is to appoint an employee director, although this is not mandatory. Instead, companies can choose from several methods, such as creating a formal workforce advisory panel or designating a non-executive director to liaise with employees. Despite being voluntary, the Code reflects a growing awareness in the UK of the benefits of incorporating employee perspectives into corporate governance.   United States   In the United States, as of now, there are no legal mandates for employee representation on corporate boards. Corporate governance in the US is typically shareholder-centric, with directors primarily accountable to shareholders. However, there has been some discussion about the potential for employee ownership models, such as Employee Stock Ownership Plans (ESOPs), which give employees a stake in the company, though this does not translate into formal board representation in most cases.   Japan   In Japan, as such there is no legal mandate for employee representation on board. However, the Japanese corporate culture often involves close consultation with employees through unions and work councils. The Japanese system emphasizes consensus-building and lifetime employment, which fosters strong relationships between management and workers, though it does not involve formal board representation.   The position in India   In India, the concept of employee directors is still relatively underdeveloped compared to European countries where mandatory worker participation on boards is more common. However, Indian corporate governance is evolving, and there are some frameworks and discussions around employee representation in the board.   Legal Framework   India’s corporate governance system is traditionally shareholder-centric, with boards primarily representing the interests of shareholders rather than employees. The Companies Act, 2013 does not mandate the inclusion of employee representatives on the boards. However, there are provisions under labour laws and sector-specific regulations that offer certain forms of worker representation in corporate governance. The following paragraphs contain brief discussion on the same:   i. Public Sector Undertakings (PSUs)       In India, the PSUs have had a long-standing practice of having employee representatives in governance. In many PSUs, the government has allowed employees to be elected to the board, representing their interests alongside other directors. As per the Department of Public Enterprises (DPE) guidelines, workers’ participation in decision-making is encouraged. Employee representatives can be part of the board in a non-executive capacity, usually representing trade unions or employee welfare organizations.   ii. Trade Unions and Workers’ Participation   The Indian labour laws encourage workers' participation in management. In large organizations with active trade unions, there is often indirect influence on company policies through worker participation mechanisms like joint management councils and work committees, although these are typically consultative bodies and not formal board membership.   iii. Employee Stock Ownership Plans (ESOPs)   Though definitely not a substitute for employee directors, Employee Stock Ownership Plans (ESOPs) in India allow employees to have a stake in the company by owning shares. Some companies with active ESOPs involve employees in decision-making to a certain degree. This concept empowers employees economically, but it does not grant them formal representation on the board.   iv. Workers' Representation under the National Labour Codes   India is all set to have four new labour codes, vi., the Code on Social Security 2020, the Occupational Safety, Health and Working Conditions Code 2020, the Industrial Relations Code 2020, and the Code on Wages 2019, that will together consolidate the existing 29 central labour and industrial laws. The idea is to avoid multiplicity of laws. As part of these ongoing labour reforms, there is increasing emphasis on worker representation at various levels of governance, however, there is no provision yet for employee directors.   v. Voluntary Practices in Private Companies   In India’s private sector, there are instances where companies with a focus on worker-friendly policies are increasingly recognizing the importance of including employees in decision-making processes, but they tend to use advisory councils or employee committees, rather than appointing employees as formal board members.   Challenges of employee representation in Board   While the concept of employee directors definitely has its merits from the perspective of corporate governance, it also comes with significant challenges, especially in countries with shareholder-centric corporate law frameworks. The following are the main challenges:   (i)  Conflict of interest : It would be a challenge for employee directors to prioritize the interests of their fellow workers over the broader goals of the company.   (ii)   Level of   competence : Serving on a board of directors requires specialized knowledge of corporate finance, strategy and risk management. For meaningful contribution to board discussions employees are expected to master these skill sets, which may be difficult.   (iii)  Supremacy of Labour Unions in certain sectors : In India, labour unions are quite powerful in sectors like manufacturing, but their interest is more on collective bargaining and labour rights than on any board representation.   (iv)  Choosing the right   representative : A large, diversified company has thousands of employees in its various departments, with various skillsets, and different priorities. Choosing the right representative to properly represent the interests of all workers is a very difficult task.   (v)   Promoter-controlled companies : In country with predominance of family-owned businesses, where decision-making is concentrated in the hands of a few key stakeholders, inclusion of employees at the board level is a difficult proposition.   (vi)  Top-down approach and   resistance to change : In India, the corporate world generally follows a top-down governance model and broader stakeholder participation will be met with extreme resistance to change.   Conditions for success of Employee Directorship   For companies considering the inclusion of employee directors, several key factors must be addressed to ensure success.   First , clear structures and guidelines must be established to define the role of employee directors, their responsibilities, and their scope of influence. There must be a balance between the enhanced voice of employees and the board's ability to act in the company's best interest.   Second , there must be training and mentorship of employees to ensure that the employee representatives have the necessary skills and knowledge to contribute effectively.   Third , there must be regular communication between employee directors and the employees to ensure that the former understand the concerns of the latter and represent their views accurately, rather than compromise the same.   And fourth , the employee directors must maintain confidentiality when participating in sensitive board discussions.   Way Forward   The concept of employee directors is part of a broader movement towards more inclusive and stakeholder-oriented corporate governance. As businesses face increasing pressure to address issues like inequality, environmental sustainability and social responsibility, the inclusion of employee voices in boardrooms could be a powerful tool for driving positive change. By involving employees in decision-making processes, companies can foster a culture of collaboration, trust and accountability, thereby leading to more sustainable and equitable business practices. Employee directors are already a key feature of corporate governance in many European countries, where laws mandate or encourage worker participation at the highest levels of decision-making. The trend towards more inclusive corporate governance, particularly in Europe, reflects a growing recognition that employee involvement can contribute to more balanced and sustainable corporate decision-making.   In India, the concept of employee directors remains at a nascent stage. While there are no concrete legal mandates for employee directors in India, the changing corporate governance norms and labour reforms could encourage a shift towards greater worker participation in decision-making. In future, it is possible that India could adopt more structured approaches to employee representation, especially in light of growing discussions on labour rights, equality, and corporate responsibility. As the country continues to integrate into the global economy and adopt best practices in corporate governance, the inclusion of employee voices, whether through formal board membership or other participatory mechanisms, could become a significant part of the corporate governance landscape. #employeedirector #board #boardofdirectors #corporategovernance #employeerepresentative #labourcode #inclusiveboard

In today’s business landscape, Environmental, Social, and Governance (ESG) factors are no longer just buzzwords—they are central pillars of sustainable corporate strategy. While much of the ESG conversation has focused on environmental responsibility and governance practices, the ‘Social’ aspect, particularly its impact on employee well-being, has often been ignored. But there is no denying the fact that companies that prioritize the well-being of their employees as part of their ESG strategies are not only fulfilling their ethical obligations but are also creating a more productive, engaged, and loyal workforce. ESG (Environmental, Social, and Governance) initiatives should have a positive and transformative impact on an organization's workforce, as they demonstrate a commitment to sustainability, ethical practices, and social responsibility.     In the light of the recent unfortunate death of Ms. Anna Sebastian Perayil, a young 26-year-old Chartered Accountant, employed at the Pune office of one of the ‘Big 4 firms’, the discussion on why and how employers must own up their responsibility for the well-being of their employees as a part of their ESG initiative, becomes all the more important. As per a letter to the Chairman of the firm by her mother, that became viral on social media, Anna is believed to have succumbed to work pressure and excess workload. It is, therefore, a high time for us, professionals, to address this ‘S’ factor of ESG and how it reflects on our work culture and the pressure and stress that we assume in our approach to work and/or ‘put’ on our juniors as part of their job responsibilities. This article is dedicated to all professionals, seniors and juniors alike, and is especially meant to draw the attention of those who sit on the delegation chairs and control the work hours, work environment and above all, the well-being of their juniors.    The Growing Importance of ESG in the Workplace   As more organizations embrace ESG, they recognize that the ‘Social’ component is more than just philanthropy or community engagement—it is about how companies treat their people. Employees are an organization’s most valuable asset, and companies that incorporate employee well-being into their ESG framework position themselves as leaders in social responsibility. This approach aligns with broader goals like enhancing workplace culture, increasing job satisfaction, and building a sustainable future. Employee well-being is increasingly viewed as a crucial indicator of a company’s social performance, and investors, customers, and employees themselves are paying close attention to how well companies live up to these standards.   The Relationship Between ESG and Employee Well-being   A strong focus on ESG directly contributes to employee well-being in several ways. In the following paragraphs, I will discuss a few areas where a company can impact the well-being of its employees:   1. Mental and Physical Health   ESG initiatives often include robust health and wellness programs that address both the mental and physical aspects of employee health. This may involve providing access to mental health support, stress management programs, or wellness initiatives such as fitness memberships, mindfulness workshops, or ergonomic office environments. Companies with a strong ESG focus are more likely to support mental health through initiatives like counselling services, flexible working hours, or mental health days, which help reduce burnout and enhance employee resilience.   2. Work-life Balance   A major component of employee well-being is the ability to balance work and personal life. ESG-conscious companies are often pioneers in flexible working arrangements, such as remote work, hybrid work models, and flexible hours, which empower employees to manage their time better. These companies recognize that work-life balance is crucial for long-term employee health and productivity. By offering the flexibility to meet personal and family commitments, companies create an environment that reduces stress, improves morale, and increases overall job satisfaction.   3. Diversity, Equity, and Inclusion (DEI)   The social pillar of ESG emphasizes diversity, equity, and inclusion (DEI) in the workplace. By fostering an inclusive environment where all employees, regardless of background, gender, or race, feel valued and supported, companies can enhance well-being. Employees in inclusive environments tend to experience higher job satisfaction, stronger engagement, and less stress. DEI initiatives also ensure that marginalized groups have equal opportunities for advancement and fair treatment, reducing workplace inequalities that can lead to stress and dissatisfaction.   4. Safe and Supportive Work Environments   ESG frameworks demand a strong commitment to workplace safety and healthy working conditions. Employees who feel safe at work—both physically and psychologically—are more likely to be productive and engaged. This includes maintaining high safety standards, especially in industries where physical labour is involved, and creating harassment-free workplaces where employees feel secure to express their ideas and concerns without fear of discrimination or retribution. Additionally, ESG-driven companies are likely to implement policies that support psychological safety, encouraging open dialogue and a culture of trust.   5. Fair Compensation and Benefits   Another way ESG impacts employee well-being is through equitable pay and benefits. Companies that prioritize ESG focus on providing fair wages, competitive benefits packages, and retirement plans. These not only meet ethical labour standards but also contribute to employees' financial security, reducing stress and fostering loyalty. When employees feel that they are compensated fairly and have access to important benefits, they experience lower financial anxiety and a greater sense of security and motivation.   Long-term Benefits of ESG on Employee Well-being   Incorporating employee well-being into ESG strategies isn’t just about meeting moral obligations—it also provides tangible benefits for businesses. Here are some of the long-term advantages:   1. Increased Employee Retention and Loyalty   Strong ESG initiatives emphasize employee safety and mental well-being, creating a safer, more supportive workplace. Employees who feel supported and valued are more likely to stay with their employer for the long term. This reduces turnover rates and the costs associated with hiring and training new employees. A company that cares for its workforce fosters loyalty, as employees feel invested in the company’s mission and values.   2. Improved Productivity and Innovation   Healthy, satisfied employees are more productive and motivated. They are also more likely to contribute creative ideas and innovations, as they feel empowered and energized to bring their best selves to work. This directly impacts the company’s bottom line and long-term success.   3. Enhanced Reputation and Attractiveness to Talent   A company with a strong ESG commitment, especially to employee well-being, attracts top talent. Today’s workforce, particularly younger generations, prioritizes working for organizations that demonstrate social responsibility. A positive reputation for caring for employees will draw in skilled workers and enhance the company’s competitiveness in the job market. ESG initiatives can lead to a sense of pride and loyalty, reducing turnover as employees align with the company’s mission.   4. Positive Impact on Stakeholder Relations   Investors, consumers, and other stakeholders are increasingly focused on companies with strong ESG practices. Businesses that prioritize employee well-being as part of their ESG agenda are more likely to gain the trust and support of stakeholders who value ethical practices, long-term sustainability, and social impact.   5. Accountability and Ethical Leadership   Clear and transparent leadership that communicates ESG goals and progress can empower employees and create a sense of accountability within the workforce. A focus on strong governance instils a culture where employees are encouraged to act ethically, reducing misconduct and aligning business practices with global standards.   Now, coming back to our original case, ESG is much more than a corporate responsibility trend—it is a framework for building sustainable, ethical, and thriving organizations. By prioritizing employee well-being within their ESG strategies, companies are investing in their most critical resource: their people. This not only leads to healthier, more satisfied employees but also drives better business outcomes, including higher productivity, enhanced loyalty, and a stronger reputation. Overburdening employees with work can lead to negative public perceptions of a company, damaging its reputation among customers, investors, and stakeholders who prioritize ESG criteria in their decision-making. Ethical treatment of employees is a core value in ESG, and failing to adhere to it can result in reputational damage.   Non-compliance with ESG Regulations   Many ESG frameworks align with global labour standards set by organizations such as the International Labour Organization (ILO). Overloading employees can lead to violations of these standards, especially regarding excessive work hours and unhealthy working conditions. As governments and international bodies increasingly integrate ESG standards into legal frameworks, overworking employees could lead to violations of labour laws and ESG-related regulations. This exposes companies to fines, legal battles, and regulatory scrutiny, all of which are detrimental to sustainable business operations.   Summing up, as ESG continues to shape the future of business, organizations that place employee well-being at the forefront of their strategy will be better positioned for long-term success in an increasingly socially-conscious world.   #esg #employeewellbeing #AnnaSebastianPerayil #charteredaccountant #bigfour #overwork

In the world of corporate governance, the influence of shareholders has evolved over the years from passive oversight to active participation in steering important company decisions. This ‘shareholder activism’ that was once considered a niche activity, has now become a global phenomenon, with institutional investors, activist funds, and even retail shareholders increasingly holding the Boards accountable. The rise of proxy advisory firms, which guide shareholders on voting matters, has further democratised this power. While the western world has been at the forefront of this movement, shareholder activism in India has also been gaining momentum, thereby signaling a significant shift in corporate governance in the country.   The Rise of Shareholder Activism   Globally, shareholder activism has transformed how companies operate. Activists often target underperforming companies, demanding strategic changes such as improved governance, better capital allocation, or even management reshuffles. Shareholder activism in the US has brought to the fore the power of shareholders to influence the fate of major corporations. Shareholder activism in the country began gaining traction in the 1980s with the rise of corporate raiders and hostile takeovers, driven by big investors and financiers like Carl Icahn or T. Boone Pickens. These activists sought to overhaul management and restructure companies for higher returns. During the two decades starting from 1990, there was increase in involvement of institutional investors who pushed for better corporate governance and accountability in the country. The focus shifted in the 2010s towards environmental, social, and governance (ESG) issues, with activists advocating for sustainable practices and diversity. Today, shareholder activism continues to shape corporate policies, emphasizing transparency, accountability, and long-term value creation.   Shareholder activism in Europe gained momentum in the early 2000s, driven by a push for improved corporate governance and transparency. The introduction of the Shareholder Rights Directive in 2007 by the European Union aimed to empower investors by enhancing their voting rights and engagement. Activists, including institutional investors and hedge funds, began to influence corporate policies, focusing on executive remuneration, board diversity, and environmental sustainability. In recent years, European shareholder activism has increasingly addressed ESG issues and corporate social responsibility, reflecting broader societal concerns. Regulatory reforms and increased shareholder engagement have further shaped the evolution of activism across European markets. With stricter regulatory frameworks and increased pressure from socially conscious investors, European companies face scrutiny over sustainability, labour practices, and diversity on their boards. Activists are not just looking for financial returns; they are advocating for long-term value through responsible governance.   The Role of Proxy Advisory Firms   Proxy advisory firms, which provide voting recommendations to shareholders, play a key role in facilitating shareholder activism. By advising on issues like executive compensation, board elections, and mergers, these firms help ensure that shareholders have the information they need to make economically sound decisions. This increases the effectiveness of shareholder activism by enabling informed voting on key issues, which can ultimately lead to better corporate performance and governance. Proxy advisory firms also level the playing field, particularly for institutional investors who may not have the resources to conduct in-depth research on every issue. By providing guidance on governance and strategic matters, they help improve decision-making and enhance economic outcomes for companies and shareholders alike.   Shareholder activism in the US is often bolstered by big proxy advisory firms like the Institutional Shareholder Services (ISS) and Glass Lewis & Co., which provide voting recommendations to institutional investors. These firms analyse company performance, board structure, executive compensation, and ESG practices, giving shareholders the necessary data to make informed decisions. Their influence in shaping shareholder votes on critical matters, such as mergers, appointment of directors, compensation policies etc. cannot be understated.   Shareholder Activism in India: A Growing Force   Historically, Indian shareholders, especially retail investors, have played a limited role in influencing corporate decisions. But with increase in institutional investment, regulatory reforms, and greater awareness of corporate governance, shareholder activism in India is gradually gaining ground. Although the concept is relatively in a nascent stage in India as compared to that in the West, it is rapidly gaining importance.   There are many factors behind this gradual shift towards shareholder activism. At the top of it is the ever-widening regulatory framework implemented by the Securities and Exchange Board of India (SEBI) that has, over the years, shifted its focus to protection of the interest of the minority shareholders and promoting transparency. This has got the much-required fillip with the introduction of the Companies Act, 2013 also.   Another big reason behind increased shareholder activism in India is the country’s growing institutional investor base, both domestic and foreign, that has begun to adopt global best practices in corporate governance. These investors are increasingly voting against resolutions they deem detrimental to shareholder value. For instance, the decision by several institutional investors to vote against excessive executive compensation packages and related-party transactions has set a precedent for more accountability in Indian boardrooms.   As for the retail investors, they are also getting more involved due to improved access to information and growing awareness of their rights. The rise of online platforms and shareholder advocacy groups is providing a voice to individual investors who historically felt sidelined by institutional shareholders and large promoters.   The Role of Proxy Advisory Firms in India   Proxy advisory firms in India have played a pivotal role in the growth of shareholder activism in the country. Proxy advisors are driving greater transparency by offering independent assessments of company performance, executive compensation, and governance structures. By scrutinizing resolutions with respect to promoter remuneration, related-party transactions, board composition, appointment of directors, mergers, dividend policies, and ESG matters they empower shareholders to challenge corporate decisions that may not align with their interests. In India, firms such as Institutional Investor Advisory Services (IiAS) and Stakeholders’ Empowerment Services (SES) have emerged as key players in advising institutional and retail shareholders on corporate governance issues.   However, the role of proxy advisory firms in India has not been without controversy. Some companies and promoters view their recommendations as intrusive, especially when they challenge deeply entrenched promoter-led managements. Furthermore, there have been calls for stricter regulation of proxy advisory firms to ensure that their recommendations are unbiased and based on thorough research.   But despite these challenges, the growing influence of proxy advisory firms in India can hardly be denied. Their role is becoming increasingly important as shareholder activism continues to rise, especially in cases where minority shareholders seek to hold promoters and boards accountable.   Methods of shareholder activism   Here are the primary methods of shareholder activism in India:   1. Voting Rights: Shareholders can exercise their voting rights on key resolutions, including mergers, acquisitions, appointment of directors, and compensation of executives. Institutional investors, in particular, use their votes to influence company decisions. Proxy voting is a common method where shareholders authorize another party (like an institutional investor or a proxy advisory firm) to vote on their behalf at shareholder meetings.   2. Filing Shareholder Resolutions: Shareholders can file resolutions or proposals to be voted upon at a company’s annual general meeting (AGM). These resolutions may pertain to governance reforms, changes in company strategy, or environmental and social issues. Shareholders may propose a resolution calling for better environmental sustainability practices or higher transparency in financial disclosures.   3. Engagement with Management: Activist shareholders can engage directly with the company’s management or board of directors to express concerns or propose changes. This dialogue often happens behind the scenes before any public actions are taken. Shareholders may meet with management to discuss concerns about underperformance or strategic direction.   4. Proxy Battles: Shareholders may attempt to gain control or influence over a company by encouraging other shareholders to vote against management proposals or to support their own board candidates. An activist investor might run a campaign to replace certain board members with their own nominees if they believe the current board is underperforming.   5. Legal Action: Shareholders can take legal action if they believe that the company’s management or board has violated corporate governance norms or shareholder rights. This can include filing lawsuits or approaching regulatory bodies like the Securities and Exchange Board of India (SEBI). If minority shareholders believe they are being oppressed or mismanaged, they can take their case to the National Company Law Tribunal (NCLT) under the Companies Act.   6. Public Campaigns: Shareholders can launch public campaigns to put pressure on the company through media outlets or social media. This is a tactic often used to gain public support and sway other shareholders.   7. Class Action Suits: The Companies Act, 2013, allows shareholders to file class action suits against the company, its auditors, or other relevant parties for any act that is prejudicial to their interests (e.g. company’s financial disclosures were misleading). This method allows a group of shareholders to act collectively.   8. Institutional Investor Activism: Institutional investors like mutual funds, insurance companies, and pension funds often hold significant stakes in companies and can influence management through their voting power or engagement. SEBI has encouraged greater participation of institutional investors in governance through the Stewardship Code.   9. Collaborating with Proxy Advisory Firms: Shareholders can seek advice from proxy advisory firms, which provide research, analysis, and voting recommendations on corporate governance issues. These firms have become influential in shaping shareholder decisions.   10. Activist Investor Funds: Some funds specialize in investing in companies where they see potential for improvements in governance or strategy. These activist investors typically acquire significant stakes in underperforming companies to push for changes that would increase shareholder value. For instance, an activist fund might buy shares in a poorly performing company and advocate for the replacement of the CEO or the sale of non-core assets.   5 notable instances of shareholder activism in Corporate India   (i) Tata Motors – resolution to increase remuneration of directors (2014) In 2014, a resolution of Tata Motors Ltd. to pay remuneration to its former MD, Karl Slym, who unfortunately had died in January that year, and to two of its executive directors in excess of permissible limits, was rejected by minority shareholders resulting in it not getting 75% votes in favour. The company had incurred loss in the past two quarters, and hence, it had to take stockholder approval because of ‘inadequacy of profit’. But India’s largest auto maker failed to get approval for these resolutions. The act of the minority shareholders at that time was unprecedented, marking the beginning of an era of activism.   (ii) Tata Sons – Controversy around removal of Cyrus Mistry (2016) The Tata Sons-Cyrus Mistry controversy highlighted the role of shareholder activism in corporate governance. In 2016, Cyrus Mistry was abruptly and unceremoniously removed as the Chairman of Tata Sons, leading to a high-profile legal battle. Mistry, backed by minority shareholders, viz., Cyrus Investment Pvt Ltd and Sterling Investment Corporation Pvt Ltd, moved the NCLT Mumbai raising concerns about the governance practices, transparency, and decision-making at Tata Sons. Shareholders, including institutional investors, became more vocal, demanding greater accountability from the Tata Sons board. The controversy showcased how shareholders can challenge decisions they view as detrimental to the company's interests, using legal avenues and public forums to influence corporate actions and governance in a major conglomerate like Tata Sons.   (iii) NR Narayana Murthy Controversy (2017) Narayana Murthy, Infosys' founder and a significant shareholder, publicly criticized the company's Board and the then CEO Vishal Sikka over issues like executive compensation, corporate governance, and transparency in a major acquisition. His activism, supported by other shareholders, put pressure on the board leading to Sikka's resignation. This episode highlighted how influential shareholders, especially founders with large stakes, can challenge board decisions and leadership, influencing corporate governance and ensuring accountability, even at large, professionally managed companies like Infosys.   (iv) Raymond Limited case (2017) This case highlighted the role of shareholder activism in family-owned businesses. In this instance, Raymond's minority shareholders, led by activist investor Amal Parikh, opposed the company's decision to sell prime real estate in Mumbai to its promoter, Gautam Singhania, at an ‘undervalued price’. The activists raised concerns about transparency, fairness, and governance in related-party transactions. Shareholders demanded higher accountability and pushed for better corporate governance practices, eventually leading to increased scrutiny over the deal.   (v) L&T – Mindtree Acquisition (2019) The Larsen & Toubro (L&T) acquisition of Mindtree in 2019 showcased the role of shareholder activism in mergers and acquisitions. L&T had initiated a hostile takeover by acquiring a significant stake in Mindtree, despite resistance from the latter's founders and management. Mindtree's founders, supported by some shareholders, publicly opposed the acquisition, citing concerns over corporate culture and strategic fit. However, L&T's strong shareholder backing, including institutional investors, enabled it to proceed with the acquisition. This case illustrated how shareholder support can influence the outcome of hostile takeovers, with institutional investors playing a decisive role in determining the future direction of a company.   The Economic Perspective of Shareholder Activism   Shareholder activism, once a fringe movement led primarily by small groups of investors, has grown into a mainstream force with significant economic implications for corporations, markets, and economies. From an economic perspective, shareholder activism plays a vital role in shaping corporate governance, resource allocation, and long-term value creation. Activists, often institutional investors or hedge funds, push for changes that can range from improving operational efficiency to revisiting capital allocation strategies and even overhauling management.   A. Enhancing Corporate Efficiency and Value Creation   At its core, shareholder activism seeks to maximize shareholder value by addressing inefficiencies within companies. Activist investors often target underperforming companies or those with management practices that do not align with shareholder interests. By pushing for reforms such as cost-cutting, restructuring, divestment of underperforming assets, or changes in corporate strategy, activists aim to enhance the overall performance of a company. This focus on efficiency has a direct impact on the economic value of a company. By pressuring management to be more accountable and focus on shareholder value, activism helps ensure that companies are using their resources optimally.   B. Better Capital Allocation   Often a key demand of shareholder activists is related to capital allocation, particularly the usage of excess cash. Many companies accumulate large cash reserves without clear strategies for investment or return. Activists often push for shareholder-friendly policies such as stock buybacks, increased dividends, or strategic mergers and acquisitions (M&A). By advocating for efficient capital deployment, activists seek to optimize the company's balance sheet, ensuring that excess capital is reinvested in growth opportunities that generate higher returns.   C. Corporate Governance and Accountability   From an economic standpoint, shareholder activism enhances corporate governance, which in turn improves the overall economic performance of firms. Poor governance practices, such as overcompensation of executives, lack of board independence, or weak accountability mechanisms, can erode shareholder value over time. Activists often target companies with governance deficiencies, demanding reforms such as better alignment of executive compensation with company performance, enhanced board oversight, and greater transparency in decision-making. By addressing these governance issues, activism contributes to a more efficient allocation of resources within firms, ensuring that managerial decisions are closely aligned with shareholder interests. This improves not only the financial health of individual companies but also the broader market.   D. Short-Termism vs. Long-Term Value   One of the key economic criticisms of shareholder activism is that it can promote short-termism. Critics argue that activists, particularly hedge funds, push for quick gains, such as cost-cutting, buybacks, or asset sales, that may benefit short-term stock performance but potentially harm long-term strategic objectives. The pressure to deliver short-term returns can lead companies to underinvest in research and development (R&D), innovation, or long-term projects, which can have broader economic consequences. However, recent study shows that while some activists may prioritize short-term profits, many focus on long-term value creation, like, better governance, more efficient capital usage, ESG, etc. These contribute to sustainable growth, job creation, reduced carbon footprint and overall economic prosperity.   E. Market Efficiency   Shareholder activism can also improve market efficiency. By identifying undervalued companies or those with poor governance, activists contribute to price discovery in the market. When activists announce their involvement in a company, stock prices often adjust to reflect the anticipated improvements in governance or strategy, thus helping markets more accurately price the value of firms. This allows investors to make better-informed decisions.   F. Economic Implications for Stakeholders   While shareholder activism primarily focuses on maximizing shareholder value, its economic implications can extend to other stakeholders, including employees, suppliers, and customers. Activist-driven changes, such as cost-cutting or layoffs, can have adverse effects on employees and the broader economy in the short term. However, if activism leads to a more sustainable business model, the long-term economic benefits can outweigh these short-term disruptions. For instance, by pushing companies to be ESG compliant activists can help firms mitigate future risks, like regulatory fines or reputational damage, which can affect their economic performance.   Role of Corporate Governance in limiting shareholder activism   Effective corporate governance practices can significantly reduce the risk of shareholder activism by fostering transparency, accountability, and informed decision-making. Key practices that can help prevent shareholder activism include:   Effective Board Composition : A board that brings together a variety of skills, experiences, diversity and perspectives ensures effective oversight and decision-making. Independent directors should be included to provide an impartial view of the company’s operations. Consistent Shareholder Engagement : Regular communication with shareholders and responsiveness to their concerns builds trust and helps mitigate the risk of shareholder activism. Comprehensive Risk Management : Companies should implement robust risk management systems to identify and mitigate potential risks, preventing financial losses or negative events that could spark activism. Clear Stakeholder Communication : Maintaining transparent and efficient communication with stakeholders ensures they are well-informed about the company’s strategy, performance, and challenges, thereby reducing the chances of any rumour or misinformation that might led to activism. Strong Compliance Framework : A robust compliance framework helps companies adhere to regulatory requirements and avoid legal issues that could lead to shareholder activism. Transparent Disclosure of Related-Party Transactions : When policies around identifying, approving, and disclosing related-party transactions are transparent, this helps maintain trust and prevent shareholder concerns. Effective Conflict of Interest Management : Proper management of conflicts of interest, particularly within board composition and related-party transactions, is essential for maintaining corporate integrity. Commitment to Corporate Social Responsibility : Adopting sound Corporate Social Responsibility (CSR) practices, especially those that further the ESG (Environmental, Social, and Governance) standards, can foster trust with stakeholders and attract ESG-focused investment.   Limitations of Shareholder Activism   Shareholder activism comes with its own share of challenges or limitations. The following are the important limitations:   Short-term Focus : Activist shareholders often seek quick financial gains, which can jeopardize the company’s long-term growth, stability, and strategic vision. High costs : Shareholder activism can incur significant legal, administrative, and operational costs for both the company and the activists, potentially reducing profitability. Time-Consuming : Responding to activist demands often requires considerable time and effort from management and the board, slowing down decision-making and operational efficiency. Management Distraction : Activism may divert management’s focus from core business activities, affecting day-to-day operations and long-term strategic objectives. Increased Volatility : Activist efforts can create uncertainty, leading to stock price fluctuations and market instability, which may harm the company’s reputation and long-term financial performance. Prioritizing interests of a few : Activist campaigns may prioritize the interests of a small group of shareholders, potentially overlooking the broader interests of all stakeholders, including employees, customers, and communities. Potential for Conflict : Shareholder activism can result in conflicts between activists, management, and other stakeholders, disrupting corporate governance and leading to power struggles that hinder effective decision-making.   Challenges and the Road Ahead   As shareholder activism continues to grow, both globally and in emerging markets like India, it is likely to play an increasingly important role in shaping corporate behaviour and driving economic growth. In India, such activism is still evolving, but it holds significant economic potential. The concentrated ownership structures in Indian companies, where promoters often hold a majority stake, pose challenges for minority shareholder, unlike in Western markets, where dispersed ownership allows greater activism. In addition, historically India has had a passive retail investor base. However, as institutional investment grows and regulatory reforms strengthen, shareholder activism is becoming a tool to improve corporate accountability and governance.   The economic benefits of shareholder activism in India are already visible in cases where activist investors have pushed for better capital allocation, more transparent governance, and the resolution of conflicts of interest in promoter-driven companies. These improvements can enhance firm performance, reduce agency costs, and attract more foreign investment, contributing to India’s broader economic growth.   India’s evolving regulatory landscape, driven by the push for transparency, from SEBI, the market regulator, holds promise. SEBI’s guidelines on related-party transactions, independent directors, and shareholder voting rights have empowered investors, particularly institutional ones, to challenge entrenched interests. Running parallel to this is the stricter implementation of the Companies Act, 2013 by the MCA that ensures the protection of shareholders’ rights and overall good corporate governance.   As India’s capital markets mature and retail participation increases, shareholder activism will likely gain further momentum. Proxy advisory firms are expected to continue to play an important role in analysing and providing recommendations to empower investors. The growing emphasis on ESG issues and long-term value creation will also reshape the nature of activism, making it more holistic rather than purely financial. #shareholder #shareholderactivism #activism #proxy #proxyadvisory #corporategovernance

Technology, if properly used, is a great boon for mankind. It can improve productivity through time-saving tools. Being an avid writer, knowing some keyboard shortcuts has always helped me in saving time. Today, I want to share some of these tools for all my readers that will help you do common tasks with just a few key strokes. For those who use Windows regularly, the shortcuts mentioned in this article will be very useful in saving time and increasing productivity. While some of these shortcuts are quite well-known already, majority of them will be new to most readers. Interestingly, they always existed in Windows, just that we didn’t quite explore them. Navigating them will make excelling in Windows just a cakewalk. All keyboard shortcuts require the users to press two or more keys together or in a specific order. For instance, to ‘undo’ a text, the shortcut is Ctrl + Z and the two keys Ctrl (Control) and Z are to be pressed in that order, i.e. press and hold the Ctrl key, then press the X key, and then release. Most shortcuts come with the keys Ctrl (Control), Fn (Function), Windows or Alt (Alternate). These four buttons are placed at the bottom-left corner of the keyboard, left of the space bar. The following is a table of some keyboard shortcuts: Summing up Thanks to advancement in technology most of us professionals are on our computers more than ever, with heavier workloads and lesser time. Saving time and increasing productivity per unit of time is very important. To a large extent, keyboard shortcuts can make this a reality. These shortcuts make creating documents on computer or laptops very much easy, however, to avail that facility, it is important to memorize all these and get into the habit of using these keyboard shortcuts regularly. #keyboard #keyboardshortcuts #shortcuts #windows #keys #keyboardhacks #hacks #coolhacks #computer #laptop #easytyping

We have oftentimes come across news items wherein doctors and other persons in the medical profession have been charged of negligence under the Consumer Protection law, leading to them being more cautious in their work. Now, it is the turn of professionals like Company Secretaries (CS), Chartered Accountants (CA) and Cost Accountants (CMA) to be more cautious in the performance of their professional duties as a government notification dated 3rd May 2023 have brought all these three professions within the ambit of a much-dreaded law – the Prevention of Money Laundering Act, 2002 or simply the PMLA. So, what does it really mean for the professionals? Why do they tend to suddenly feel being in deep water now? In this article, I will elaborate on the scope and objective of this Act and the enhanced responsibility put on the shoulder of these professionals to curb money laundering in the country. In order to set the tone for discussion on this topic, let us first dive a little deeper into what the PMLA is all about. So let us have a look at some important points from the Act. Prevention of Money Laundering Act, 2002 The Prevention of Money Laundering Act, 2002, which, along with the rules framed thereunder, came into force w.e..f. 1st July, 2005, was enacted by the Parliament of India with a view to preventing the heinous activity of money-laundering in the country. The idea behind was to aid the global efforts against money laundering and related crimes. With a view to combatting such illegal activities, apart from strict punishment, including imprisonment, the Act also provided for confiscation of any property acquired from or through laundered money. Definition of Money Laundering Section 3 of PMLA defines the term as follows: “Whosoever directly or indirectly attempts to indulge or knowingly assists or knowingly is a party or is actually involved in any process or activity connected with the proceeds of crime including its concealment, possession, acquisition or use and projecting or claiming it as untainted property shall be guilty of offence of money-laundering. *Explanation – (i) For the removal of doubts, it is hereby clarified that – (i) a person shall be guilty of offence of money-laundering if such person is found to have directly or indirectly attempted to indulge or knowingly assisted or knowingly is a party or is actually involved in one or more of the following processes or activities connected with proceeds of crime, namely – (a) concealment or (b) possession or (c) acquisition or (d) use or (e) projecting as untainted property or (f) claiming as untainted property in any manner whatsoever (ii) the process or activity connected with proceeds of crime is a continuing activity and continues till such time a person is directly or indirectly enjoying the proceeds of crime by its concealment or possession or use or projecting it as untainted property or claiming it as untainted property in any manner whatsoever – Section 3 of Prevention of Money Laundering Act as amended w.e.f. 1-8-2019. *The explanations were added in an amendment in 2019. Inter-connected transactions Where a certain transaction involves two or more transactions that are inter-connected and one or more of such transactions are found to have involved money laundering, then the other transactions shall also be presumed to come under money-laundering as inter-connected transactions and accordingly shall be subject to adjudication or confiscation. Financial Intelligence Unit – India (FIU-IND) This unit was set by the Government of India in 2004 as a central agency to receive, process, analyse and disseminate information relating to financial transactions alleged to be related to money laundering. It is an independent body reporting directly to the Economic Intelligence Council (EIC) headed by the Finance Minister of India. Under the PMLA Act and Rules, banking companies, financial institutions and intermediaries are under obligation to verify the identity of clients, to maintain records and furnish necessary information in prescribed format to the Financial Intelligence Unit - India, in short, the FIU-IND. Person Carrying on Designated Business or Profession Section 2(1)(sa) defines “person carrying on designated business or profession”. Until before the notification under discussion, the following persons were included within the definition: (i) a person carrying on activities for playing games of chance for cash or kind, and includes such activities associated with casino; (ii) Inspector-General of Registration appointed under section 3 of the Registration Act, 1908 (16 of 1908) as may be notified by the Central Government; (iii) real estate agent, as may be notified by the Central Government; (iv) dealer in precious metals, precious stones and other high value goods, as may be notified by the Central Government; (v) person engaged in safekeeping and administration of cash and liquid securities on behalf of other persons, as may be notified by the Central Government; or Sub-section 2(1)(sa)(vi) authorises the Central Government to designate by notification when certain other activities performed for or on behalf of another natural or legal person will come under the ambit of money laundering, or in other words, to designate other persons carrying on designated business or profession. Notification number S.O. 2036(E) was issued under this provision on 3rd May 2023 to include in the definition of “person carrying on designated business or profession” a ‘relevant person’ carrying on certain activities on behalf of their client shall be. The term ‘relevant person’ has been defined in the explanation to mean a practising Company Secretaries (CS), a practising Chartered Accountants (CA) and a practising Cost Accountants (CMA). Hence CSs, CAs and CMAs are now persons carrying on designated business or profession. Reporting Authority Section 2(1)(wa) of PMLA defines ‘reporting entity’ as a banking company, financial institution, intermediary or a person carrying on a designated business or profession. The role of a reporting entity under PMLA is the following: Maintenance of records of all transactions in such manner as to enable it to reconstruct individual transactions (for a period of five years from the date of transaction between a client and the reporting entity) Furnish to the Director within such time as may be prescribed, information relating to such transactions, whether attempted or executed, the nature and value of which may be prescribed Maintenance of record of documents evidencing identity of its clients and beneficial owners as well as account files and business correspondence relating to its clients (for a period of five years after the business relationship between a client and the reporting entity has ended or the account has been closed, whichever is later) Every information maintained, furnished or verified, except as otherwise provided under any law for the time being in force, shall be kept confidential by the Reporting Authority. The Director under the Act may call for from any reporting entity any of the above records and the reporting entity is required to furnish to the Director such information within such time and in such manner as may be specified. Every such information sought by the Director must be kept confidential. Section 12AA of PMLA requires the reporting authority to ensure enhanced due diligence prior to commencement of each specified transaction as follows: (a) verify the identity of the clients undertaking such specified transaction by authentication under the Aadhaar (b) take additional steps to examine the ownership and financial position, including sources of funds of the client, in such manner as may be prescribed (c) take additional steps as may be prescribed to record the purpose behind conducting the specified transaction and the intended nature of the relationship between the transaction parties In case if the client fails to fulfil the conditions listed above, the reporting entity must not allow the specified transaction to be carried out. If any specified transaction or series of specified transactions undertaken by a client is considered suspicious or likely to involve proceeds of crime, the reporting entity shall increase the future monitoring of the business relationship with the client, including greater scrutiny or transactions in such manner as may be prescribed. The information obtained while applying the enhanced due diligence measures must be maintained by the reporting authority for a period of five years from the date of transaction between a client and the reporting entity. Explanation u/s 12AA defines ‘specified transaction’ to mean— (a) any withdrawal or deposit in cash, exceeding such amount; (b) any transaction in foreign exchange, exceeding such amount; (c) any transaction in any high value imports or remittances; (d) such other transaction or class of transactions, in the interest of revenue or where there is a high risk or money-laundering or terrorist financing, as may be prescribed. Onus or burden of proof Where a person is accused of being involved in money laundering, the onus is on him to prove that the alleged proceeds of crime have actually been lawfully acquired by them. Punishment for money-laundering The PMLA prescribes a punishment of 3 to 7 years rigorous imprisonment to any person found guilty of money-laundering. However, if the offence also comes within the ambit of Narcotic Drugs and Psychotropic Substance Act, 1985, the maximum term of rigorous imprisonment shall be 10 years. Attachment of property The property acquired by using the proceeds of crime or the laundered money can be confiscated by the Adjudicating Authority. Adjudicating Authority In terms of sub-section (1) of section 6 of the PMLA, an Adjudicating Authority has been constituted to exercise jurisdiction, powers and authority conferred by or under this Act. The Adjudicating Authority under PMLA has powers to regulate its own procedure and is not bound by the procedures laid down in the Code of Civil Procedure,1908. Appellate Tribunal Section 25 of the PMLA mandated the Central Government to establish an Appellate Tribunal to hear appeals against the Adjudicating Authority and other authorities under the Act. The section was amended in 2016 to provide that the Appellate Tribunal constituted under sub-section (1) of section 12 of the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 (SAFEMA) shall be the Appellate Tribunal for hearing appeals against the orders of the Adjudicating Authority and the other authorities under the PMLA also. This Appellate Tribunal under (SAFEMA) is one of the earliest tribunals in the country and also hears appeals under the Sea Customs Act, 1878, the Customs Act, 1962, the erstwhile FERA, 1947, the FERA, 1973, and those related to persons detained under the COFEPOSA whose detention orders were neither revoked by the Government nor set aside or quashed by the courts of competent jurisdiction, subject to the conditions specified in Section 2 of the Act. Orders of this tribunal can be appealed against in the appropriate High Court and finally to the Supreme Court. Notification dt. 3rd May 2023 Sub-section 2(1)(sa)(vi) authorises the Central Government to designate by notification when certain other activities performed for or on behalf of another natural or legal person will come under the ambit of money laundering. Under this provision, on 3rd May 2023, notification number S.O. 2036(E) has been issued by the Ministry of Finance, Department of Revenue, Government of India. As per this notification, the below-mentioned financial transactions carried out by a ‘relevant person’ on behalf of their client shall be considered as an activity relating to money laundering. The term ‘relevant person’ has been defined in the explanation to mean a practising Company Secretaries (CS), a practising Chartered Accountants (CA) and a practising Cost Accountants (CMA). The following financial transactions have been identified in the notification: Buying and selling of any immovable property; Managing of client money, securities or other assets; Management of bank, savings or securities accounts; Organisation of contributions for the creation, operation or management of companies; Creation, operation or management of companies, limited liability partnerships or trusts, and buying and selling of business entities. Hence, going forward practising CSs, CAs and CMAs will be covered under the scanner as and when they execute any financial transactions on behalf of a client. Members belonging to all the three professions are on thin ice now. Their vigilance, carefulness, due-diligence and strict professionalism will be tested more rigorously from now on. Concluding observations The new notification under PMLA is a bold step of the government towards speeding up its battle against anti-money laundering activities. The new provisions are expected to help probing against dubious transactions by shell companies involved in money laundering. But by providing an inclusive definition of ‘relevant person’ to include these three professions only, the government has clearly shown its intent of keeping practising advocates or any other person out of the net, although they might also be in the position to do any of the financial transactions identified in the notification as connected to money laundering, on behalf of the client. However, the more optimistic thinking on the part of these professionals would be to consider this move as a reassurance of the reliance the government has always had on these three professions, this time in its battle against money laundering. The proof of this can be found in section 2(1)(wa) of PMLA which now includes these three professions within the meaning of a ‘reporting entity’. Reporting authorities are mediums in the hands of the government for gaining information about dubious transactions. So, CS, CA and CMAs are now expressly clothed with the responsibility of being whistle blowers in case they come across any such transactions. If they are not careful enough, they will be hauled up for being partners in the crime of money laundering by their clients. If professionals have been handling the money of the client for financial transactions on their behalf whether in India or abroad, now it is a better idea for them to stay away from doing so. #PMLA #Moneylaundering #laundering #professional #reportingauthority #Enforcement #CS #CA #CMA