Page 90 - NITI - Navigating Indian Traditions in Industry

and ethical business practices. Below are a few key areas where ancient teachings
align with contemporary legal frameworks:

Corporate Governance and Fiduciary Duty: The Niti Shastra underscores the
importance of fairness and accountability, which has a direct correlation with modern
corporate governance principles. One of the key features of corporate governance is
the concept of fiduciary duty, where directors and executives of a company are legally
bound to act in the best interests of the organization and its stakeholders. This duty is
very much aligned with the ancient emphasis on fairness, transparency, and justice.

Example: 1
The Companies Act, 2013 in India, specifically Section 166, mandates that directors
of a company must act in the best interest of the company, ensuring transparency and
fairness in all dealings. This echoes the teachings of Niti Shastra, where the ruler or
leader’s actions must be transparent, ethical, and just.

Regulatory Compliance and Accountability: The Niti Shastra also teaches the
importance of adhering to established rules and regulations in governance, which
directly relates to modern business compliance systems. The text emphasizes that
failure to comply with legal norms can result in the downfall of a ruler or organization,
highlighting the consequences of non-compliance.

Example: 2

The Securities and Exchange Board of India (SEBI) regulations ensure that corporate
financial reports and disclosures meet specific standards of accuracy and transparency.
These regulations enforce compliance to prevent corporate misconduct, ensuring that
businesses adhere to legal standards similar to those outlined in the Niti Shastra.

Whistleblower Protection and Ethical Conduct: The Niti Shastra encourages
transparency and ethical behavior, not only for the ruler or leader but also for the
people they govern. This idea of moral integrity and accountability is reflected in
modern laws that protect whistleblowers, ensuring that unethical practices are reported
and addressed promptly.
Example: 3

The Whistleblower Protection Act, 2014 in India offers protection to employees who
report corporate fraud or unethical practices. This law aligns with the principles of
justice and ethical accountability seen in the Niti Shastra, where both leaders and their
subjects are held accountable for their actions.

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