An Analysis of Corporate Governance Issues Arising Out of Related-Party Transactions: With Special Reference to NSE 200 Companies

The moderation role of board independence change in the relationship between board characteristics, related party transactions, and financial performance

“…In the Indian context, related party transactions are regulated under the Companies Act 2013, which has replaced the Companies Act 1956. Under the Companies Act 2013, the criteria for related party transactions can be split into four components: the identification of related parties, related party transactions, the approval process, and disclosure requirements [ 33 ]. The first component of the regulatory framework defines related party as directors and their relatives, a company in which a director, manager, or their relative is a partner, a body corporate whose board, managing director, or manager is accustomed to acting in accordance with the advice, to a public business in which a director or management is a director and owns more than 2% of the firm’s paid-up share capital with his relatives, a private company in which a director or manager is a member or director, directions or instructions a director or manager is accustomed to act, except if advice/ directions/ instructions are given in the professional capacity, directions or instructions of a director or manager, except if advice/ directions/ instructions are given in the professional capacity, any person on whose advice, any company which is a holding, subsidiary, or an associate company of such company, or a subsidiary of a holding company to which it is also a subsidiary, such other persons as may be prescribed.…”