Oil companies fined for the fifth consecutive quarter, unable to meet the criteria

For a fifth consecutive quarter, public sector oil company Indian Oil, Bharat Petroleum and gas company GAIL, among other major oil companies, are hit with a fine for not meeting listing criteria. The fines were slapped for the failure of companies to elect an adequate number of independent and women directors on their respective boards of directors.

Exchanges BSE and NSE have fined Indian Oil Corporation, Hindustan Petroleum, Bharat Petroleum, Oil India, GAIL, and Mangalore Refinery and Petrochemicals for not fulfilling the listing requirement in the April-June quarter. The companies separately told the stock exchanges that appointment of directors is to be done by the government and they have no role in it.

The rules also mandate companies to have independent directors in equal proportion to executive or functional directors and at least one woman director. BPCL has also received fines of Rs 2,41,900 each from BSE and NSE for not having a single independent director on its board. The company has cited its inability to influence the appointment of directors and indicated that it would waive the fine on both BSE Ltd and NSE. HPCL on its part has confirmed that it has been fined a sum of Rs 5,36,900 each by BSE and NSE.

Similar fines have been imposed on GAIL. The companies stressed that the non-compliance was beyond their control and was not due to any negligence on their part. "It is submitted that the non-compliance with regard to the composition of the Board was neither due to any negligence/lapse of the Company nor was within the control of the management of GAIL and continuous efforts were also made to meet the compliance requirements," GAIL said.