Legislative framework of corporate governance in India

Corporate governance has now become an issue of global significance due to International Financial Reporting Standards. Poor corporate governance and lack of transparency of corporate financial reporting have frequently been identified as some of the root causes of the Asian financial crisis. Good corporate governance is the prompt and voluntary disclosure of information about the company's financial performance. The higher the level of disclosure, the lower is the uncertainty as more information is disclosed. Transparency enhances productivity, which begets profitability and much is expected from the modern corporation.In India, it is mandatory for all the listed companies to comply with the revised Clause 49 recommended by Securities & Exchange Board of India (SEBI) of listing agreement, which came into operation on 1st January 2006 to protect the interests of investors through enhanced governance practices. The present study seeks to determine the extent to which the Oil and Natural Gas Corporation (ONGC), one of the public sector petroleum enterprises disclose its corporate governance practices i.e. mandatory and non-mandatory by examining the annual reports of above mentioned company for seven year(i.e. from 2003–04 to 2010–11).