Responsibilities and Effectiveness of Boards of Indian Startup Companies

In the inaugural session of the workshop, Professor Rajendra Srivastava embarked on a comprehensive exploration of "Measuring Performance - Growth, Profitability, and Value Creation." Professor Srivastava initiated the discussion by highlighting the pivotal role of innovation as a competitive advantage, illustrating how it sets a company's offerings apart in the marketplace. Throughout the session, conversations delved into the multifaceted impact of innovation, encompassing aspects such as product development, operational efficiency, and market positioning.

In the section dedicated to Value Creation and Appropriation Metrics, Professor Srivastava introduced metrics that offer a holistic evaluation of a company's performance, emphasising intellectual property, brand equity, and customer relationships as key indicators.

The discourse then shifted to the profound influence of Intangible Assets on Business Value (Market Capitalisation), underscoring the significance of intangible assets like brand reputation and patents as critical drivers of a company's market worth.

Subsequently, the discussion explored various Value Creation Strategies and Processes, exemplified through case studies of FOSUN and WeWork, providing insights into the diverse tactics employed by businesses to generate value.

In conclusion, Professor Rajendra Srivastava integrated the concepts of Value Creation and Value Appropriation to introduce the pivotal concept of Business Innovation, emphasizing its role as the cornerstone of sustained innovation in the business world.

In the second session, Professor Shashwat Alok delved into the intricacies of Corporate Governance & Firm Value. Professor Alok initiated the discussion by introducing the fundamental concept of corporate governance, emphasising its pivotal role and the associated challenges, particularly in the context of both large and early-stage firms.

The exploration of Growth unfolded as Professor Alok elucidated the essence of growth and when precisely it contributes to firm value. Moving on to Valuation, he introduced the theory of valuation while drawing a clear distinction between the concepts of value and valuation.

Professor Alok then provided a comprehensive analysis of Valuation Approaches, delving into various methodologies, including Discounted Cash Flow valuation, Relative Valuation, and Real Options.

The subsequent focus on Corporate Governance and Value delved deeper into the subject's relevance, using notable cases such as WeWork, GoMechanic, and Byju's to illuminate pertinent corporate governance issues.

In conclusion, Professor Shashwat Alok underscored the complexity of Governance and Valuation. While acknowledging positive developments in the Indian market and regulatory landscape, he emphasised the need for ongoing evolution in areas such as bank governance, startups, and ESG considerations. Furthermore, he advocated for a new framework for startup governance, one that balances growth with financial prudence and sustainability, and called upon investors to be catalysts for this transformation.

In this session, Mr. Ganesh Balakrishnan talked about Collaborating with Auditors in Corporate Governance.

 Mr. Ganesh Balakrishnan started off by talking about the growing Indian Startup ecosystem, responsibilities of board of directors, and the role of the board in PE investment.

When addressing Corporate Governance, he talked about the four pillars of CG and the seven principles of Corporate Governance and their benefits for startups.

In the segment on Due Diligence and Risk Assessment, Mr. Balakrishnan talked about the different types of due diligence such as legal due diligence, financial due diligence, operational due diligence, and management interviews.

While talking about the Role of External Auditor, Mr. Balakrishnan focused on the pivotal role played by external auditors in a startup setting. The discussion on Evaluating an Audit Report was designed to deepen the understanding of an audit report's contents. The discussion then shifted to the Significance of Internal Controls.

Overall, Mr. Ganesh Balakrishnan's sessions provided comprehensive insights into the audit process, the interpretation of audit reports, and the importance of internal controls in maintaining financial integrity in a startup.

In this enlightening session, Professor Hariom Manchiraju provided a comprehensive exploration of the topic "Identifying Financial Shenanigans." Commencing with a foundational discussion on the pivotal Role of Accounting in the Capital Market Ecosystem, Professor Manchiraju underscored its role as a purveyor of vital financial information to investors, analysts, and regulatory authorities, thereby fostering well-informed decision-making.

The session continued with a deep dive into the Framework of Financial Statement Analysis, wherein Professor Manchiraju elucidated the importance of comprehending financial statement structure and the assessment of earnings quality. Additionally, the distinction between Accrual Accounting and Cash Accounting was clarified in a segment dedicated to this subject.

Moreover, the session scrutinised the motives behind earnings management, providing a thorough examination of this topic. Techniques for Detecting Earnings Management, including Marginally exceeding thresholds, Discretionary accruals, Beneish M-Score, and Piotroski F-Score, were discussed in detail.

In conclusion, Professor Hariom Manchiraju's session provided invaluable insights into the crucial role of accounting in the capital market ecosystem. It not only illuminated the nuances of financial statement analysis but also shed light on the motivations and methodologies underlying earnings management practices

Professor Rajendra Srivastava concludes the workshop with the final session - Summarizing Actionable Learnings.

In this final session, Professor Srivastava provides insights into various aspects of corporate innovation and governance, strategies for value creation and appropriation, financial product portfolio management, market intelligence, and the role of business processes in driving shareholder value. He also emphasizes the need for governance beyond compliance and references the Strategic Service Framework for marketing activities and shareholder value.

The session concludes with all the participants giving their feedback about the workshop.