DRIVIN G ROWTH - Dr. Reddy's

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corporate governance
A CONTINUING COMMITMENT
R. REDDY’S
D
LABORATORIES has been
committed to good corporate
governance well before such practices were
mandated by law. It has always believed
that an independent board following best
international practices, transparent
disclosures and empowerment of
shareholders are as necessary as solid
financial results for creating and sustaining
shareholder value.
An industry-wide corporate governance
initiative in India was pioneered by the
Confederation of Indian Industry (CII) in
1997-98. Subsequently, the Securities and
Exchange Board of India (SEBI) set up a
committee on corporate governance. Based
on the recommendations of this committee,
a new Clause 49 has been inserted into the
listing agreement of all the stock exchanges
in the country, which specifies the
standards that listed Indian companies have
to meet and the disclosures they have to
make with regard to corporate governance.
This chapter, along with the chapters on
management discussion and analysis and
additional shareholder information, show
how Dr. Reddy’s not only complies with,
but also goes beyond the standards of
corporate governance and disclosures
mandated by Clause 49.
At Dr. Reddy’s, corporate governance
revolves around four basic processes:
■ Governance by directors;
■ Responsibility of management;
■ External and internal audit systems; and
■ Information to stakeholders.
governance by directors
DR. REDDY’S IS A BOARD –
DRIVEN company, and all key decisions
are taken only after detailed discussions by
the Board. The Board acts with autonomy
and independence in exercising strategic
supervision, discharging its fiduciary
responsibilities, and in ensuring that the
management observes high standards of
ethics, transparency and disclosure.
The Directors are experts in the fields of
medicine, chemistry and medical research,
human resource development, business
strategy, finance and economics. They
review all information relating to significant
business decisions, including strategic and
regulatory matters. Every member of the
Board, including the non-executive
Directors, has full access to all information
of the Company.
DR. REDDY’S LABORATORIES LTD. | CORPORATE GOVERNANCE | ANNUAL REPORT 2001-2002