The government and regulators need to get more objective about governance and compliance if the real objective is making doing business easier, Kiran Mazumdar Shaw on November 22 said.
The Biocon chief also flagged the deepening trust deficit between government and the industry saying there is an increasing tendency to criminalise every businessman.
"I think corporate governance needs to be looked at objectively as there is a tendency towards over-regulation now. We take extreme views on checks and balances," Shaw told a corporate governance summit organized by former Sebi chairman M Damodaran.
The situation has reached such a level that corporate leaders are forced to spend more time in meeting compliances than running their businesses, she averred.
"Our regulations have actually fallen into the realm of over-regulation. I think we are not really objective about the kind of regulations that we want. We take extreme views to plug every loophole possible. But I don't think that's the way forward. We need more time for our businesses than attending to compliances," Shaw said.
Citing the example of her own company Biocon, Shaw said she had "ticked onto as many as 1,567 compliance boxes. This is overburdening any business. Then we try to criminalise every non-compliance. This is now the trend."
The whole regulatory framework that we have today is something that needs to be objectively looked at, she said and pointed out that "corporate governance is about an ethical and moral code of business conduct. But for that to happen we must be very objective about what are the must-haves and where and how we want to regulate the businesses."
There is also a need to develop more trust between the regulator and the regulated entities and also to find newer and more effective ways to nudge people to adopt good corporate governance, she said.
"Today you are criminalising everything, you are becoming too extreme. Is it fair? We need to trust each other more. Today everybody thinks the other is a crook, especially the regulator/government, and fix everyone else," she said.
Supporting Shaw's views on regulations, an ex-board member of Tata Sons, R Gopalakrishnan said regulations should be culturally compatible to be effective, because what works in America will not work here.