Extracted 21OCT2011 from http://tinyurl.com/3v3b5ga
India will soon replace the 56-year-old Companies Act with a new legislation aimed at improving corporate governance and checking frauds in boardrooms... the key focus is on ensuring that companies adopt good practices that are proposed to be facilitated by induction of independent directors who follow a Code of Conduct.Besides, the new bill will contain provisions related to various board-level committees such as audit committees, audit and remuneration panel and stakeholder relationship committee. To check against such activities in the future, the new Companies Bill proposes more effective regulation of related party transactions as well as through checks on diversion of funds through subsidiary and associate companies. There are checks on auditors too with the proposed legislation mandating rotation of auditors after a stipulated period of time. Even investors are proposed to be empowered by the law allowing them to file class-action suits against the activities of errant companies and their management. Further, the Investor Education and Protection Fund is being strengthened to empower investors.