Regulatory convergence Technology Innovative professionalism

1. Regulatory convergence Technology Innovative professionalism ICSI National Convention 14 October 2011, Agra Vijaya Sampath Bharti Group

2. The impact of convergence upon regulation will probably far exceed the impact of regulation upon convergence. So the great question for the future is not how convergence can, or should be regulated but how regulation must change in the light of convergence Fali Nariman committee on convergence in 2000

3. Drivers of effective policy and law • Increasing outbound M&A transactions : global foot print • Urge to change “Emerging” status to developed economy • Classic economics : movement of capital, people, assets, organization : eliminate barriers over time • Dismantling of state monopolies: Aviation, Telecom, Power, Infrastructure and PPP model • Geographic concentration of industries for economic efficiency • Rise in economic power directly proportional to increase in political influence on world stage • Optic fiber and capital markets link what geographic boundaries and tariffs kept apart

4. Need for regulatory convergence • India low on competitiveness ranking (overall 56, burden of government regulation 97, basic requirements 91) • Self inflicted wounds: restrictions imposed by government policies • Progress across select but critical sectors neither consistent nor fast enough • Archaic and obsolete laws/ regulations out of sync with times • Internecine strife between various vested interests : crab theory • Low impetus to real economic growth: many impediments • Holistic and concerted effort required: giant leap forward not small hesitant steps

5. Laudable objectives: National Competition Policy • Enhance the role of competition in government policy at centre and state levels : uniform access to markets • Effective mechanism for synergy between sectoral regulations and CCI – complementary Vs contradictory • Culture to enhance competition in domestic, local and international markets: larger public good and consumer welfare • Create a framework of policies and regulations to facilitate competitive outcomes in the market : harmonious construction • Provide a platform for efficient business environment and resource allocation : equal treatment and equitable opportunity • Prevent abuse of market power and promote good governance : effective implementation of regulations • Policies for economic incentives to pursue productive efficiency and quality innovation: promote entrepreneurship

6. Easier said than done • Dealing with multiplicity and complexity • - Jurisdictional and regulatory overlap • - Separation between policy making, operations and regulations • Law maker, licensor, equity owner, infrastructure controller and distributor • Market power asymmetries • - Disparities in market growth and level of sophistication • - Uneven and unequal stages of economic development • Current dynamics • - Impact of disruptive technology changes • - Independent regulator: each has its own focus and area • Confusing conflicts • - SEBI/CCI/sector regulator • - Administrative ministries: differing agenda and timelines • Sovereignty and security • - Regional concerns and nationalistic ambitions • - Security and governance over public interest

7. Consistency and transparency in application and interpretation of law and regulations Ability for all to see the larger picture Independence and integrity of regulators Co-operation between centre, states and local authorities Mindset change: competition is good for all Consensus building across sectors Reducing dependency on courts for resolution Speedier enactment of forward thinking laws and policies Implement effectively and provide level playing field Government needs to walk the talk: saying is not enough, doing is Critical success factors Red Queen effect: need to keep running faster to stay in the same place

8. Short term pain Service providers Command and control Transparency Politics Nationalist sentiments Public interest Long term benefits Consumers Free market forces Trade secrecy Economics International ambitions Commercial motive The balancing act

9. Technology for business • Place, device and time shift seamless : communication, content and laws • Tools : video conferencing, audio streaming, webinars, software for documents, chat rooms, blogs • Banking transactions, money transfers, tax payments, e auctions • Free flow of information : use and misuse • Online trading and retailing : eBay, Amazon, Groupon, Flipkart • New business models : Google, Apple, Microsoft, Zynapse • Relevance of social media:: Face book, LinkedIn, Twitter • Availability and accessibility of information: overload or use selectively • Benefits of MCA 21, dematerialized shares, XBRL, email reports

10. Technology tools for company secretaries • Microsoft Office • Email Management • Time Recording • Discovery Systems Secure email • Digital Dictation • Case Management Accounts / PMS • Document Management • Database • System Integration • Voice Recognition • Extranet • External Internet Services Workflow / Authorization • Social Networking • Knowledge Management • Electronic Archiving • Web based services • Photocopy / Printer Usage tracking HR Systems • Intranets • Management Information Intelligent Searching • Billing systems Blogs

11. Constraints Package / System does not Do what you expected Companies/ employees not willing To change System is “far too Complicated” Cost too much / taking too long Govt. systems don’t keep up System is unreliable / fails to Run quickly / has errors Not seen the expected benefits System is “taking over” – takes longer to maintain the system than provide the service! Quick obsolescence System makes business Process worse not better! Don’t know what could Be done with system I am too old to learn new stuff Everyday Inadequate training

12. Benefits of technology • Technology changes an opportunity, not a threat • Remote access and control : geographical location is irrelevant • Preserving confidentiality : secure access • Learning tool : webinars, knowledge management, sharing information • Exchange of information & best practices at optimal cost • Social media has given everybody a voice and power • Speedier work at RoC, scope for less manual intervention • Access to wide international databases for practice and precedents

13. Transparency Vs right to privacy Laws unable to keep pace with technology :always a few steps behind Liability of intermediaries for on line content Training and updates: too frequent and vast changes Avoiding complexity and information overload Does it really bridge the digital divide or increase the difference Investment and change costs may be high Too many devices, all “smart” but complicated for ordinary user Use of brain power Vs computing power: creativity and innovation Technology challenges

14. Future Knowledge of subject & experience Strategic advisor & leader Core requirement Managing risk & reputation risk Communication skills Versatility across geographies Ethical values Expectations CS career a default option Strong Business orientation Total focus on compliance little business judgment Cost efficient & productive Legal proficiency still important Compliance oriented Past Current

15. Interfaces CS and in house counsel Board of directors Auditors Internal audit Shareholders Business divisions Finance, HR Supply Chain Marketing, R&D External law firms & counsel Partners, Vendors, Suppliers Courts / arbitrators Government agencies Regulators Industry bodies Chamber of Commerce Media

16. The “must haves” • High level of technical competence • Clear identity & purpose: role & responsibility • Business and customer orientation: Efficient service • Confidence and self reliance on strength and capability • Uses technology significantly to advantage • Clear mandate: participative and interactive • Understand business imperatives: • Appreciate client requirements: practical solutions • Structured and integrated team • Value systems and integrity, handling conflict • Ability to deal with coolness under crisis, thinking on feet

17. To be “ Any eye on the past, astute as to the present, peer into the future and predict the uncertain and unknown ”

18. Thank you