Deals with Corporate Governance Issues with Oil and Natural Gas Corporation, a public sector undertaking in India. This presentation forms part of my Corporate Governance Assignments submitted in Semester IX 2018.

1. Oil and Natural Gas Corporation
A helpless cash-cow knee deep in corporate governance woes
27 October 2018 | Corporate Governance
Presented By:
Shubham Soni
shhubh2@gmail.com

2. 27 October 2018 | Corporate Governance
About ONGC
• Founded 14 August 1956; 62 years ago
• It was conferred with 'Maharatna' status by the
Government of India in November 2010. The Maharatna
status to select PSUs allows more freedom in decision
making.
• In a government survey for fiscal year 2016-17, it was
ranked as the largest profit making PSU in India
• Ranked 11th among the Top 250 Global Energy
Companies by Platts.

3. ONGC Shareholding Pattern
As on 31st March 2018
27 October 2018 | Corporate Governance

4. The Company’s Corporate Governance practices have secured many accolades, some
of them are:
1. ‘Best Corporate Governance’ and ‘Environmental Excellence & Sustainable
Development’ by the Indian Chamber of Commerce in year 2012.
2. ‘Golden Peacock Award’ for Corporate Governance, U.K. in the Years 2005, 2007,
2008, 2009, 2013 and 2016.
3. The Company has received ‘ICSI National Award for Excellence in Corporate
Governance’ - Certificate of Recognition from the Institute of Company
Secretaries of India for 5 years in a row from 2010 to 2014.
Corporate Governance Measure
Apart from the mandatory measures has adopted:
1. Whistle Blower Policy,
2. Annual Report on working of the Audit & Ethics Committee,
3. MCA Voluntary Guidelines on Corporate Governance, &
4. Enterprise-wide Risk Management (ERM) framework.
Excellent Corporate Governance?
27 October 2018 | Corporate Governance

5. ONGC Today
27 October 2018 | Corporate Governance

7. What Happened?
27 October 2018 | Corporate Governance
Government Intervention Happened
1. Unwarranted Dividend Payouts
2. Fuel Subsidies
3. Bailing Out GSPC
4. Buying HPCL after taking debt
5. Selling stake to pay off debt

8. 2017 GSPC Bailout
27 October 2018 | Corporate Governance
• Made to acquire all of the 80% stake of the Gujarat State
Petroleum Corporation for Rs. 8000 Crore, which owned
Krishna Godavarari Basin since 2003.
• Block did not see any commercial production even by late
2015.
• The Gujarat State Petroleum Corporation has debt of Rs
19,576 crore, for which they pay interest of Rs 1,804.06
crore per year.

9. 2018 HPCL Takeover
Business Standard
27 October 2018 | Corporate Governance
1. Forced to buy the Hindustan Petroleum stake for Rs 36,915
crore, at a price that was 14% higher than the market rate.
2. Compelled to borrow Rs 35,000 crore.
3. As per ONGC’s balance sheet for 2017-’18, the company has
borrowings of Rs 25,592.2 crore.

10. 2014 Stake Sale Controversy
27 October 2018 | Corporate Governance

11. Quick Questions
1. What model of corporate governance do you
think fits companies like ONGC?
2. How do you bring good corporate
governance in a model without autonomy?
3. What can minority shareholders do?
27 October 2018 | Corporate Governance

12. 2009 Goldman Sachs Controversy
DNA March 05, 2009
From Business Today
27 October 2018 | Corporate Governance

13. Thank You