Financial Services Secretary Rajiv Takru recently said that the ministry wants the Life Insurance Corporation of India to play a more active role in companies where it is a major shareholder.
“LIC needs to play an active role in these companies as it is public money which is invested there,” said Takru.
He further urged LIC to be more active in participating in board meetings and protect the interests of investors where it has substantial stake. “If there is any issue of corporate governance in companies where it is a major shareholder, LIC should not hesitate to report it,” he said.
LIC, with around Rs 18-lakh crore worth assets under management, had more than 15 per cent holding in entities such as Corporation Bank, Simplex Realty, Standard Battery and Larsen and Toubro as of March 2013.
The Government, which is the owner of LIC, has also been seeking an increase in the equity cap of the country’s largest life insurance company.
IRDA guidelines cap the equity limit of LIC in a company at 15 per cent. However, the LIC Act allows the insurer to invest up to 30 per cent in a single company.
