‘Decision-making can’t be influenced in listed companies’

Ownership and management are treated at arm’s length, says HPCL CMD State-owned oil marketing company (OMC) Hindustan Petroleum Corporation Limited (HPCL) generated heated debates when it chose not to recognise ONGC as its parent even after the latter bought 51% stake in HPCL from the government for Rs. 37,000 crore. HPCL’s chairman and managing director Mukesh Kumar Surana explains the position. Edited excerpts: What is the status of ONGC’s acquisition of HPCL? As far as the acquisition is concerned, on 31st January the government has transferred its 51% stake to ONGC. So, the transaction is complete. HPCL created a controversy by not recognising ONGC as parent… The controversy is created by the people who are reading different pieces of inputs and then trying to put it together. There are certain definitions as per the Companies Act, as per SEBI, based upon which various companies, when such transaction happens, are supposed to perform. I would like to clarify that we have served the clarifications and I don’t see any controversy to that effect. Ultimately, whatever is correct [information] should go to the exchanges. Actually, it does not matter materially in the functioning. The promoter control/holding is not decided by the shareholders. There is a definition. We have already done some filings and asked for clarifications. We have made the filing as per our understanding of the statute. You have retained the position of CMD of HPCL while the corporate governance structure requires having just one chairman for the group and subsidiaries headed by MD and CEOs… It’s not for me to decide. The director and chairman of all public sector companies, irrespective of whosoever is the owner, will be decided by the government. Even for OVL, which is the wholly-owned subsidiary of ONGC, the directors are decided by the government. Actually, its not even important if I am the chairman or not. Basically, the question is on the autonomy for the function. Things should be decided based on the rationale and not the envelope.

Source : https://www.thehindu.com/todays-paper/tp-business/decision-making-cant-be-influenced-in-listed-companies/article25091703.ece

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