SECURE SYNOPSIS: 28 JUNE 2019
NOTE: Please remember that following ‘answers’ are NOT ‘model answers’. They are NOT synopsis too if we go by definition of the term. What we are providing is content that both meets demand of the question and at the same time gives you extra points in the form of background information.
Topic: Salient features of world’s physical geography. Conservation, environmental pollution and degradation, environmental impact assessment
Why this question:
The article brings out the glacier meltdown of Himalayas and how it has both good and bad consequences.
Key demand of the question:
One must weigh the positives and negatives of the glacier meltdown being witnessed in the Himalayan glaciers.
Directive:
Analyze – When asked to analyze, you have to examine methodically the structure or nature of the topic by separating it into component parts and present them as a whole in a summary.
Structure of the answer:
Introduction:
Begin with facts of climate changing around the Himalayan glaciers.
Body:
Explain the melting of Himalayan glaciers, and that Himalayas are losing 8 billion tonnes of frozen water annually. Then explain how these revelation calls for focused strategies to tackle its causes and consequences. The Himalayan snow deposits, the lifeline of the rivers emanating from this mountain chain, are critical to meet the water needs of millions of people in India and other Asian countries, particularly during the pre-monsoon summer months.
Explain how this can as well be seen as a benefit to source the water scarcity issue, list the benefits.
Conclusion:
Conclude with way forward.
Introduction:
The Hindu Kush Himalayan (HKH) region extends 3,500 km over all or part of eight countries from Afghanistan in the west to Myanmar in the east. According to ICIMOD report, 70–80% of the region’s original habitat has already been lost and that loss may increase to 80–87% by 2100. Two-thirds of Himalayan glaciers, the world’s “Third Pole”, could melt by 2100 if global emissions are not reduced.
Body:
Importance of Himalayan Glaciers:
- The Himalayan snow deposits, the lifeline of the rivers emanating from this mountain chain.
- It is critical to meet the water needs of millions of people in India and other Asian countries.
- The Himalayan altitude and snow have been protecting India from outside invaders since the early times thus serving as a defence barrier.
- By virtue of their scenic beauty, they have developed a large number of tourist spots.
Causes for melting glaciers:
- Global warming as the most dominant cause for snow decay.
- It also adds that the rampant environmental pollution in the plains along the Himalayan hills as also a cause.
- The air pollutants, such as black soot (carbon) and dust, which find their way to the glacial ice, absorb heat from the sun and hasten snow melting.
- Human activities like burning of fossil fuels, oil and gas drilling, deforestation, increasing land use in mountain regions, etc. are responsible for increasing rate of melting of these glaciers. Carbon dioxide and various Greenhouse gases emissions have caused temperature to rise even in poles.
The consequences of melting glaciers are
- It has ramifications for the global climate. This region is a heat source in summer and a heat sink in winter.
- Along with the Tibetan Plateau, this influences the Indian summer monsoon. So, any changes in this region would have a bearing on the monsoon itself that already shows signs of changes in spread and distribution.
- It could trigger a multitude of biophysical and socio-economic impacts, such as biodiversity loss, increased glacial melting, and less predictable water availability—all of which will impact livelihoods and well-being in the HKH.
- Faster snow and glacier melting due to warming is already manifesting in formation of glacial lakes. Glacial lake outburst floods (GLOF) are becoming frequent and causing huge casualties and loss to local infrastructures.
- Glaciers in HKH have been retreating faster, and consistently causing greater water flows in rivers. In Tibetan Plateau, river run off has increased by 5.5 per cent.
- Most of the lakes in high altitudes have also reported water level rise by 0.2 m/year besides their surface areas expanding.
- ICIMOD report paints a bleak picture for the future of a region that is the source of Asia’s 10 major rivers and provides water, food, energy and carbon storage for almost two billion people.
- Biodiversity is in steep decline driven by human development, pollution, overexploitation of resources and climate change. Example: Urbanization is on rise in many of the HKH countries.
- With the growing impacts of climate change, along with new infrastructure development, trade routes and hydropower dams planned for the fragile region, the effects on the biodiversity is set to worsen further.
- Along with species loss this will mean the loss of the key environmental services the region provides – such as water and carbon storage – to the rest of Asia.
- Hydropower is a big threat, with over 550 large projects in existence or under construction. Example: The dams constructed and diversions of Amu-Darya and Syr Darya have now almost stopped feeding the Aral Sea.
- Many of these areas are remote and authorities have little control over border regions sometimes plagued with ongoing conflict. Example: Indo-Burma hotspot.
Way forward:
- To stop this temperature rise and to cool the planet, slowing down greenhouse gas emissions won’t be enough. Current conditions will have to reversed, which will be the greatest challenge for the human race in the coming years.
- Better for all of us to accelerate to net zero as a matter of the highest priority. Net zero means the amount of greenhouse gases emitted into the atmosphere is no more than the amount taken out.
- Governments must focus on creating enabling environments and institutions that empower mountain people to share in the regional and global achievements and benefits of inclusive growth and sustainable development.
Conclusion:
Even 1 degree rise in global earth temperature is alarming because it takes a lot of heat to do so. Various impacts of climate change today are being seen and faced on earth like melting of glaciers, uneven extreme climate events, loss of habitats of various species, etc. It is very important thus, to control any further increase in temperature through environmental treaties and efforts by all the nations on planet Earth.
Topic: Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes; mechanisms, laws, institutions and Bodies constituted for the protection and betterment of these vulnerable sections.
Why this question:
The article is in the backdrop of the recent judgement of Bombay High Court that upheld the reservation given to the Maratha community.
Demand of the question:
The answer must analyse how the mandate of reservation has changed overtime and whether the aspects of the mandates are justified or not.
Directive word:
Critically analyze – When asked to analyze, you have to examine methodically the structure or nature of the topic by separating it into component parts and present them as a whole in a summary. When ‘critically’ is suffixed or prefixed to a directive, one needs to look at the good and bad of the topic and give a fair judgement.
Structure of the answer:
Introduction
Start with brief background of the context of the question.
Body
Students must weigh the pros and cons of reservation polices, first explain how reservation process and intent in terms of the target community to aim for social justice has changed /transformed over time.
One must explain both pros and cons and provide for a balanced opinion.
Conclusion
Conclude with what needs to be done and what should be the way forward.
Introduction:
Reservation in India is the process of facilitating a person in education, scholarship, jobs, and in promotions who has category certificates. Reservation is a form of quota-based affirmative action. In a significant judgment, the Bombay High Court has upheld the reservation given to the Maratha community. It has brought down the quantum of reservation from 16%, as determined by the state assembly, to 12-13%.
Body:
Original need for reservations:
- Reservation in India is the process of facilitating people in education, scholarship, jobs etc that were faced historical injustice.
- Reservation is governed by constitutional laws, statutory laws, and local rules and regulations.
- The system of reservation in India comprises a series of measures, such as reserving access to seats in the various legislatures, to government jobs, and to enrolment in higher educational institutions.
- The reservation is undertaken to address the historic oppression, inequality and discrimination faced by those communities and to give these communities a place. It is intended to realise the promise of equality enshrined in the Constitution.
- Reservation helps in level playing field because we cannot expect groups who are historically deprived of education, skills, and economic mobility to suddenly start competing with those who had access to these means for centuries
- Though Meritocracy is an important aspect, it has no meaning without equality
- The primary objective of the reservation system in India is to enhance the social and educational status of underprivileged communities and thus improve their lives.
Need to re-examine reservation policy:
- Unlike in the late Sixties and again in the late Eighties, when the reservation discourse originated in a deep sense of unfairness of the social system, today’s reservation discourse draws its strength from unfair development policies.
- Reservation is increasingly seen as a remedy for the adverse effects of ill-thought out development policies.
- Reservation is also called ‘Discrimination in Reverse’ or Reverse Discrimination. This terminology connotes that reservation, which works as a protection to the reserved categories i.e. scheduled castes, scheduled tribes and other backward classes, acts as a reverse discrimination against the upper castes.
- For political parties reservation discourse is convenient because it allows them to keep subscribing to the consensus over economic policies, avoiding a critical approach to the root causes of the problem.
- The reservation system has just become a tool for politicians to gain vote banks.
- Many in the above communities are politically and economically strong enough and placing the whole community under the reservation system will be unethical.
- The Supreme Court has ruled multiple times against exceeding its 1992 formula of a maximum of 50% reservation (Indira Sawhney v. Union of India).
- It also defined that a backward class cannot be determined only and exclusively with reference to economic criterion.
- It will lead to neglect of merit and it may cause social unrest as it was at the time of Mandal commission
- Thus, the quota for the economically poor among the upper castes has been seen essentially as poverty alleviation move dressed up as reservation.
- The policy has transformed from a policy meant to provide a level playing field for those suffering from historical discrimination and those who are weaker sections of the society to a policy meant as a dole for those sections of society who are poor and lack jobs.
Way forward:
- The government will have to expand the economic aspect and create fresh opportunities so that people, especially young people, who leave agriculture are absorbed in non-farm sectors.
- It is time that India made a critical assessment of its affirmative action programmes.
- The government should consider the economic, political and social wellbeing of the community and make a balanced decision.
- Problems of these castes should be addressed through government schemes and programmes.
- Progressive steps should be taken to ensure that poorer section among the backward communities get the benefit of reservation system.
- The policy of reservation should be gradually phased out after it serves its purpose.
Topic: Issues relating to development and management of Social Sector/Services relating to Health
Why this question:
The article states that widespread vaccination programmes can help achieve WHO’s global call to eliminate cervical cancer as a public health problem.
Key demand of the question:
The answer must discuss the HPV and the challenges around the vaccination.
Directive:
Critically analyze – When asked to analyze, you have to examine methodically the structure or nature of the topic by separating it into component parts and present them as a whole in a summary. When ‘critically’ is suffixed or prefixed to a directive, one needs to look at the good and bad of the topic and give a fair judgement.
Structure of the answer:
Introduction:
Begin by explaining what is HPV. ‘Human Papilloma Virus (HPV)’ causes penile cancer in men and cervical, vaginal, anal & vulvar cancer in women.
Body:
Discussion should include the following:
Have a detailed discussion on the HPV, its spread and onset.
Then discuss the current status of the Vaccination drive for HPV in India, explain the issues and challenges around it. what are the views opposing it, supporting it etc.
Conclusion:
Conclude by stating importance of it.
Introduction:
Human Papilloma viruses (HPVs) is a class of virus which causes an infection that is easily spread through direct sexual contact, from the skin and mucous membranes of infected people to the skin and mucous membranes of their partners. It causes penile cancer in men and cervical, vaginal, anal & vulvar cancer in women. It can also cause throat or rectum cancer in both men and women. The virus is transmitted through intimate contact like – sexual intercourse, oral or anal sex. It poses a higher risk for HIV-infected persons, smokers, and people dependent on hormonal contraceptives.
Body:
Challenges around the vaccination for HPV:
- India has the largest burden of cervical cancer in the world and about 70,000 women die because of it each year.
- Around 70% of these cases are caused by infections from HPV strains, which the vaccines prevent.
- In India, two vaccines namely “Gardasil” & “Cervarix” are available.
- These vaccines protects against almost 90% of genital warts in men and women.
- The HPV vaccine is given thrice within six months to girls aged 9-13 years, before they become sexually active.
- Post-vaccination, a girl should ideally undergo pap smear tests every three years to check for pre-cancerous or cancerous cells.
- Punjab and Delhi have already begun vaccination for girls.
- National Technical Advisory Group on Immunisation (NTAGI) has proposed the inclusion of these vaccines in UIP for nationwide implementation.
- However, the medical community in India is divided over the vaccine’s utility.
Views opposing HPV vaccination:
- The cost of the vaccine is around INR 12,000 per person and the budget to cover a huge population are the major challenge in India.
- With 6.2 crores Indian girls aged 9-13 years, the cost to the government will be over Rs 56,000 crores.
- Also there is no data to suggest that they comprehensively prevent invasive cervical cancer as evaluation requires long testing periods.
- HPV vaccine has also been found to have side-effects such as regional pain syndrome and neurological problems in some cases.
- Contrarily, India is already witnessing a declining trend in cervical cancer due to better nutrition, hygiene & reproductive patterns.
- Hence, a case for improving these aspects further, rather than expose the entire population to the vaccination holds ground.
Views supporting HPV vaccination:
- ‘WHO Global Advisory Committee for Vaccine Safety (GACVS)’ had concluded that there the HPV vaccines are safe.
- 71 countries had introduced HPV vaccine in their immunisation programme for girls and 11 countries included boys too.
- Australia was the first country to introduce HPV vaccination in its school program and now has the lowest level of cervical cancer.
- In India there is already enough manpower and cold storage for vaccines.
- Hence, some argue that the prevention cost will be lower than treatment cost.
- As, awareness on prevention of HPV infections and safe sex is low in India, there is a view that it can’t be solely relied to fight HPV.
Conclusion:
The efforts needs to be scaled-up in low and middle-income countries (LMICs), where the burden of disease is far greater than in high-income countries. Redoubling our efforts to tackle the fiscal, supply, and programmatic barriers that currently limit HPV vaccine programmes; with these efforts, HPV vaccination could become a hallmark investment of cancer prevention in the 21st century
Topic: Major crops cropping patterns in various parts of the country, different types of irrigation and irrigation systems storage, transport and marketing of agricultural produce and issues and related constraints; e-technology in the aid of farmers.
Why this question:
The question is straightforward and must discuss the approach for sustainable agriculture and suggest solutions for tackling agrarian distress.
Key demand of the question:
The answer must discuss the role of Agri markets, physical infrastructure that needs to be supported along with direct income support to make agrarian distress
Directive:
Explain – Clarify the topic by giving a detailed account as to how and why it occurred, or what is the particular context. You must be defining key terms where ever appropriate, and substantiate with relevant associated facts.
Structure of the answer:
Introduction:
Describe the conditions of agrarian distress.
Body:
The answer must emphasize on the methods of handling agrarian distress in a sustainable manner, one has to elaborate how income transfer alone can not be a fixed one-shot solution to the problems facing agriculture.
Conclusion:
Conclude with importance of having multi-pronged approach to address the distress.
Introduction:
The lack of remunerative prices for the crops is one of the main reasons for Agrarian distress in India today. The various options like Minimum Support Price for about 25 crops, Farm Loan Waiver schemes undertaken by various state governments have failed to alleviate the problem. The NSSO Situation Assessment Survey of Agricultural Households (2013) shows that 52% of farming households are indebted, with rates as high as 89-92% in some States.
Body:
Direct Cash/Intervention Scheme: This involves the Direct Benefit Transfer (DBT) of the cash to the farmers.
- It can be enforced to include almost all the farmers who have access to formal banking channels (Jan-Dhan Accounts).
- Provides financial help at proper time/ season and would also spur the investment cycle in the farm economy.
- Helps large as well as small farmers and can even be capped to limit unwarrantedly huge transfers to rich farmers.
- The corruption issue can be eliminated as farmers directly get the cash in their accounts.
Examples of Direct Intervention Schemes:
- Pradhan Mantri Kisan Samman Nidhi will provide assured income to small and marginal farmers. The amount will be transferred directly into their account in 3 equal instalments. With this decision, all land holding eligible farmer families (subject to the prevalent exclusion criteria) would avail of the benefits under this scheme. It would not only provide assured supplemental income to the most vulnerable farmer families, but would also meet their emergent needs especially before the harvest season.
- The Telangana government’s income/investment support through the Rythu Bandhu Scheme (RBS). Telangana started RBS in May 2018, whereby it gave Rs 4,000 per acre to every farmer. This transfer is made twice a year, coinciding with the two cropping seasons. By directly giving cash, the government aims to support the input purchases of farmers. The scheme is said to have reached almost 93 per cent of landowners.
- Odisha has launched the KALIA scheme that will provide Rs. 10,000 to about 3 million small and marginal farmers for the Rabi and kharif crops.
- Jharkhand has announced a Rs. 5,000-per-acre payment to 2.3 m medium and marginal farmers from the next financial year.
- West Bengal has announced two new schemes for farmers and farm labourers in the state that entail a payment of Rs.5,000 per acre every year in two instalments besides Rs.2 lakh to the kin of farmers who die due to any reason, including suicide.
However, the other problems like Rigid Market Structure, Middlemen issues, Poor infrastructure and logistics, Information Asymmetry, Government Policies also reveal that the Agricultural Marketing has remained a weak point. This has resulted in poor incomes to farmers despite good produce, gluts in the market leading to price crashes, high amount of food rotting and wastage.
Therefore, there is a need to improve the agricultural marketing too by taking up following measures:
- It is imperative to bring agriculture marketing into the Concurrent or Union list to benefit farmers. This will guarantee remunerative prices to farmers.
- The Committee on Doubling Farmers’ Income under the chairmanship of Ashok Dalwai justifies the recommendation saying marketing has no boundaries; this necessitates a pan-India operation to meet the demand across the country.
- NITI Aayog’s model Agricultural Produce and Livestock Marketing Act should be implemented by the states. Further the provisions like facilitating single-point levy of taxes, promoting direct interface between farmers and end-users, and give freedom to farmers to sell their produce to whomsoever and wherever they get better prices.
- e-NAM is a good step in this way. Budget 2018 announced developed GRAMS which would be integrated to the e-NAM Structure.
- Promoting warehouse receipts, agro-processing and exports. Warehouse receipts will help framers defer their sale immediately post harvest, when prices are at their lowest level.
- This will require a consolidation of farm produce, which can be successfully done through farmer-producer organisations.
- Agro-processing and trade will require investment in developing infrastructure.
- Existing agri-export zones need to be revisited and strengthened in this changing scenario.
- States alone cannot revamp the agricultural marketing sector, primarily due to paucity of funds and technology.
- Private investment on a massive scale needs to be invited to upgrade and build large storage and warehousing systems that are climate resilient.
Conclusion:
The agrarian distress is a result of combination of factors. Thus, the need of the hour is a multi-pronged approach tackling the structural issues. It is time to concede that production and marketing should march together in order to benefit farmers and consumers. A co-ordinated effort with good policies bolstered by logistics of the private players can help in achieving the goal of doubling farmer’s income by 2022.
Topic: Major crops cropping patterns in various parts of the country, different types of irrigation and irrigation systems storage, transport and marketing of agricultural produce and issues and related constraints; e-technology in the aid of farmers.
Why this question:
The question is from the static portions of GS paper III.
Key demand of the question:
The answer must discuss the role played by IT in augmenting the agriculture system and as well explain the challenges faced in the spread of e-technology to farmers.
Directive:
Discuss – This is an all-encompassing directive – you have to debate on paper by going through the details of the issues concerned by examining each one of them. You have to give reasons for both for and against arguments.
Structure of the answer:
Introduction:
Begin with brief introduction by explaining the need for e-technology to farmers.
Body:
Discussion should include the following:
Role of IT in agriculture; as a tool for direct Agri productivity and as an indirect tool for empowering farmers.
Major challenges in the spread of e-technology to farmers – lack of literacy to understand the technology, gaps in infrastructure, reach, mobility and connectivity etc.
Explain in detail the associated hurdles.
Conclusion:
Conclude with way forward.
Introduction:
Information Technology (IT) has long been viewed as having great potential for improving decision making in agriculture. IT has connected the world globally and is now changing our life style and social consciousness dynamically. In all phases of the agricultural industry, information technologies are vital to the management and success of a business. Agriculture has also been greatly influenced by IT.
Body:
Role of IT in Agriculture:
In the context of agriculture, the potential of information technology (IT) can be assessed broadly under two heads:
- as a tool for direct contribution to agricultural productivity
- As an indirect tool for empowering farmers to take informed and quality decisions which will have positive impact on the way agriculture and allied activities are conducted.
Precision farming, popular in developed countries, extensively uses IT to make direct contribution to agricultural productivity. The techniques of remote sensing using satellite technologies, geographical information systems, agronomy and soil sciences are used to increase the agricultural output. This approach is capital intensive and useful where large tracts of land are involved. Consequently it is more suitable for farming taken up on corporate lines.
The indirect benefits of IT in empowering Indian farmer are significant and remains to be exploited. The Indian farmer urgently requires timely and reliable sources of information inputs for taking decisions.
Access to technology is one of the most important enablers for smallholders to improve productivity sustainably. Innovative mechanisms for technology transfer are required to bring relevant tools, knowledge and knowhow to farmers.
Market linkages are common weak points between the smallholders and formal supply chains. Intermediaries are required not only to aggregate production from small-scale growers, but also to provide support and services to ensure the quality and consistency of production.
ICT applications can foster dissemination of information on technology, market demand and price information; weather, pest, and risk-management information, best practices to meet quality and certification standards.
To bridge the information gap between the farmers and to build productive and competitive market, different ICT interventions support rural and under-developed markets to become efficient and productive.
The rapid changes in the field of information technology make it possible to develop and disseminate required electronic services to rural India. The existing bottlenecks in undertaking the tasks need to be addressed immediately.
Challenges in spread of e-technology to farmers:
Mobile Connectivity:
- Even the masses have access to mobile connectivity, but the potential of the handsets are not yet tapped. This is largely because of the content delivered is often not directly related to their livelihood and environment. Since they need localised news and information directly delivered in their language to meet their daily needs.
- Affordability is a key issue for many potential users. Not everyone can afford handsets; innovative business models adopted by the firms and handsets at low price tag which work for voice and sms based services.
- Other challenge in disseminating agriculture related information is dynamic nature of information. Farming is not so linear but requires constant inputs at every stage where new technological inputs provide better crop outputs.
Internet Connectivity:
- Haphazard development:
- It is observed that some initiatives have already been made to provide IT based services to farmers. However, duplication of efforts are witnessed as most of the services revolve around limited subjects.
- Keeping in view the giant task involved, it is necessary to form a coordination mechanism to strive for a concerted effort to support farming community in the country. Such a coordination agency may only have advisory powers.
- User friendliness:
- The success of the strategy depends on the ease with which rural population can use the content.
- This will require easy language, training to farmers and intuitive graphics based presentation.
- Local languages:
- Regional language fonts and mechanisms for synchronisation of the content provides a challenge that needs to be met with careful planning
- Restrictions:
- Information content based on remote sensing and geographical information systems can provide timely alerts to the farmers and also improve the efficiency of administration.
- Power Supply:
- In most of the rural India, power supply is not available for long hours. This will reduce the usefulness of the intended services.
- Since almost entire country receives sunshine for most part of the year, it is useful to explore solar power packs for UPS as well as for supply of power.
- Connectivity:
- Despite the phenomenal progress made in the recent years, the connectivity to rural areas still requires to be improved.
- Reliable connectivity is a prerequisite for a successful penetration of IT into rural areas.
Conclusion:
The use of IT in agriculture has grown rapidly in the past few years. It is increasingly being used to help managers make better decisions. However, IT and the problem facing decision makers are constantly changing. Thus, future information systems for research purposes will be significantly different than current systems because of these changes. IT has been one of the most aspired fields in today’s world. Integrating IT with agriculture will help any country to regulate its overall economy and trade.
Topic: Attitude: content, structure, function; its influence and relation with thought and behaviour; moral and political attitudes; social influence and persuasion.
Ethics by Lexicon publications
Why this question:
The question is based upon the principle of Morality.
Key demand of the question:
Explain in detail in what way morality can be affected by circumstances using suitable examples and justify to what extent it is feasible and right to let the situations define morality.
Directive:
Analyze – When asked to analyze, you have to examine methodically the structure or nature of the topic by separating it into component parts and present them as a whole in a summary.
Structure of the answer:
Introduction:
Define Morality in brief.
Body:
Such questions are best explained with case studies or examples, explain incidences where morality has been rightly guided by situations at the same time it has been misguided too, draw a fair and balanced opinion and substantiate your stand.
Conclusion:
Conclude with importance of Morality in life in general.
Introduction:
Morality is a particular system of values and principles of conduct concerning with the distinction between right and wrong or good and bad behaviour. It is something which depends upon one’s knowledge of understanding and ability to interpret.
Body:
As Mahatma Gandhiji says, “Morality is the basis of things and truth is the substance of all morality“. One’s basis of moral values may differ from culture to culture or society to society or community to community, but at the end essence of it remains the same.
Note: You can give example of your own here
Sample e.g.: Killing a person in self-defence is not immoral as it is right of a person to life. However, on the other hand the age old practice of sati is considered immoral hence no circumstances such as backwardness, orthodoxy etc. can justify it.
Conclusion:
Moral resilience is often tested due to prevailing culture, political interference etc. At such times it is necessary for people to uphold their moral values in society. Ethics and morality should come from the soul, only then our society will emerge as a powerful entity.
Topic: Corporate Governance
Ethics by Lexicon publications
Why this question:
The question is based on the concept of corporate governance.
Key demand of the question:
Explain in detail the concept of corporate governance, the issues associated with it in India. what needs to be done to set the path right for the corporate governance to work in the right direction.
Directive:
Discuss – This is an all-encompassing directive – you have to debate on paper by going through the details of the issues concerned by examining each one of them. You have to give reasons for both for and against arguments.
Structure of the answer:
Introduction:
Begin with brief definition of corporate governance.
Body:
Explain what you understand by corporate governance in detail.
What are the challenges, issues and concerns in professing the same?
Discuss specific set of issues frequently witnessed.
Suggest what can be done?
Conclusion:
Conclude with way forward.
Introduction:
Corporate governance is the system of rules, practices and processes by which a firm is directed and controlled. It includes the rules relating to the power relations between owners, the board of directors, management and the stakeholders such as employees, suppliers, customers as well as the public at large. It essentially involves balancing the interests of a company’s many stakeholders, such as shareholders, management, customers, suppliers, financiers, government and the community. Ethics is at the core of corporate governance, and management must reflect accountability for their actions on the global community scale.
Body:
The ethical issues with Corporate Governance in India:
- It is common for friends and family of promoters and management to be appointed as board members.
- In India, founders’ ability to control the affairs of the company has the potential of derailing the entire corporate governance system. Unlike developed economies, in India, identity of the founder and the company is often merged.
- Women director appointed are primarily from family in most of the companies which negates the whole reform.
- Appointed independent directors are questionable as it is unlikely that Independent Directors will stand-up for minority interests against the promoter. In the Tata case, these directors normally toe the promoter’s line.
- An independent director can be easily removed by promoters or majority shareholders. This inherent conflict has a direct impact on independence.
- Data protection is an important governance issue. In this era of digitalisation, a sound understanding of the fundamentals of cyber security must be expected from every director.
- Board’s Approach to Corporate Social Responsibility (CSR) is often found unsupportive.
- Conflict of Interest – The ICICI Bank Ltd fiasco demonstrates the challenge of managers potentially enriching themselves at the cost of shareholders in the absence of a promoter.
Measures to improve Corporate Governance in India:
- For the good corporate governance focus should be shift from independent director to limiting the power of promoters.
- Promote women from diverse background rather than from family as board of director.
- A well composed Audit Committee to work as liaison with the management, internal and statutory auditors, reviewing the adequacy of internal control and compliance with significant policies and procedures, reporting to the Board on the key issues.
- Risk is an important component of corporate functioning and governance, which should be clearly acknowledged, analysed for taking appropriate corrective measures. In order to deal with such situation, Board should formulate a mechanism for periodic reviews of internal and external risks.
- A clear Whistle Blower Policy whereby the employees may without fear report to the management about unprincipled behaviour, actual or suspected frauds or violation of company’s code of conduct. There should be some mechanism for adequate safeguard to personnel against victimization that serves as whistle-blowers.
- Strengthening the power of SEBI, ICAI, and ICSI to handle the corporate failure. As for example in Sahara case, court has to intervene to bring justice.
- CSR projects should be managed with much interest and vigour.
- The board must invest a reasonable amount of time and money in order ensures the goal of data protection is achieved.
- A robust mechanism should be developed to mitigate risk. A better management of risk may avoid Kingfisher like debacle.
- Explicitly approved norms of ethical practices and code of conduct are communicated to all the stakeholders, which should be clearly understood and followed by each member of the organization.
- The objectives of the corporation must be clearly recognized in a long-term corporate strategy including an annual business plan along with achievable and measurable performance targets and milestones.
Conclusion:
Currently, India accounts nearly 3% of world GDP and 2.5% of global stock market capitalisation – with 5,000 listed companies and more than 50 companies in the global Fortune list. Uday Kotak committee recommendations hold importance in growing concerns for corporate governance. The recommendations of the Kotak committee will enhance transparency and effectiveness in the way boards of listed companies function
