ONGC Faces Threat Of Delisting

With Petroleum Ministry’s attempts to seek time from Securities and Exchange Board of India for appointment of independent directors on board of PSUs, including ONGC, failing, the exploration and production major has not only attracted penal provisions for non-compliance of corporate governance norms, but also faces the threat of delisting. An adjudication proceeding has already been initiated against the company for non-compliance of Clause 49 of the Listing Agreement, which stipulates that at least 50 per cent of the board should comprise independent directors. Non-compliance with listing agreement can invite a fine of up to Rs 25 crore. Besides, stock exchanges can suspend the dealing or trading of the securities of the company.