CII launches charter for startups with focus on corporate governance

INDUSTRYBODYCIIHASLAUNCHED a charter for startups that enlist voluntary recommendations on corporate governance keeping in view unique nuances to govern startups.

The Corporate Governance Charteralsoprescribesguidelines appropriate for startups based on the specific stages of their life cycle. “This charter is designed for entities incorporated under the Companies Act, 2013 only, and therefore the term ‘Startup’. However,entitieswhichareinthe natureofsoleproprietorship,limitedliabilitypartnership,partnerships may adopt similar structures/ guidelines for corporate governance within their organization,” the Confederation of Indian Industry (CII) stated.

The purpose of this charter is to help startups become responsiblecorporatecitizensandalsoenable them to share it with their stakeholders to establish themselves as being well-governed, it said. R Dinesh, President, CII, said that early adoption of good governance practices helps startups gain tangible and intangible benefits

including long-term value creation, stakeholders’ trust, better access to finance from investors and banks, reduced reliance on promoters, effective organisationalstructuresandimproved chances of long-term survival of the business.

Hehopedthatthegovernance charter for startups will enable earlyadoptionofgoodgovernance practices amongst startups and help them evolve into leaders of tomorrow. Kunal Bahl, Chairman of the CII National Startup Council and Co-founder of Titan Capital & Snapdeal, said it is vital to embed thetenetsofgoodcorporategovernance from the earliest days of a startupsothat,overtime,theybecome part of the organization’s DNA, helping guide and steer the startup and all its stakeholders through various stages of its growth and evolution.