Our Bureau

New Delhi , Sept 28

APPREHENDING possible delisting if it fails to meet the December 31 deadline for complying with the corporate governance norms prescribed by the capital market regulator, GAIL (India) has asked the Petroleum Ministry to take immediate steps to appoint six more independent directors on its board.

Speaking to newspersons soon after the 21st AGM of the company, Mr Proshanto Banerjee, CMD, said: "We have written to the Petroleum Secretary, Mr S.C. Tripathi, to fulfil the requirement before the December 31 deadline of the meeting the amended Clause 49 of the Listing Agreement norms." Currently, the GAIL board comprises six functional directors, three Government nominees, and three independent directors.

To meet SEBI criteria prescribed for listed companies, which come into effect from January 1, 2006 all companies must have 50 per cent independent director.

This in effect would mean that GAIL would require six more independent directors so that the board consists of nine directors (functional plus Government nominees) and nine independent directors.

Regarding the number of Government nominees on a PSU board, Mr Banerjee said that the guidelines are in place from Department of Public Enterprises.

While stating that the Government, being the owner of the PSUs, has full authority to nominate the number of directors on a company's board, he however, added that the guidelines should be binding on the PSU and the administrative Ministry.

A major spat recently took place between the CMD of ONGC, Mr Subir Raha, and the Ministry for Petroleum and Natural Gas, over the number of Government nominees on the company's board.

Mr Raha had put it on record that he would quit if more Government directors were put on the company's board.

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