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MUMBAI, 25 JUNE

Rating agency Icra has assigned its first corporate governance rating to ITC. The rating agency has assigned CGR2 to the tobacco major on a rating scale of CGR1 to CGR6, where CGR1 denotes the highest rating.

This is the first corporate-governance rating in the country.

According to Icra, the rating indicates that the company has adopted and followed the practices, conventions, and codes, that would provides its financial stakeholders a high level of assurance on the quality of corporate governance. It, however, added that the rating was not a certificate of statutory compliance or a comment on ITC’s future financial performance, credit rating or stock price. The variables that had been analysed for arriving at the rating were : sahreholding structure, corporate governance structure and management process, board structure and processes, stakeholder relationship and financial discipline, including transactions with subsidiaries and associates.

ICRA’s corporate governance rating is meant to indicate the relative level to which an organisation accepts and follows the codes and guidelines of corporate governannce practices.

The practices in a company reflect the distribution of rights and responsibilities among different participants (such as the board, management, shareholders) and the policies and systems laid down and followed for making business decisions.

The emphasis of the Icra’s rating is on a corporate ‘s business practices and quality of disclosure standards that address the requirements of the regulators and financial stakeholders.