Dec 2011: Corporate governance is a subject that attracts a lot of media attention, particularly just after a scandal. Regulation only ensures compliance. Unfortunately, compliance does not equal commitment to corporate governance.
This was one of the key findings of the third edition of the India Board Report 2011. Clause 49 of SEBI’s listing agreement has been widely praised, in terms of the standards of corporate governance that it sets. However, only 38% of the respondents of the survey felt that it significantly contributed to improving governance.
There are other indications as well. More than half the respondents pointed out that their boards did not have a formal process to evaluate their effectiveness. Two-thirds of the independent directors surveyed said that the roles and responsibilities of non-executive directors were not defined clearly. Around 50% of them felt that the time spent by the board in completing the agenda of the meeting was inadequate.
Little wonder then, that companies complain about the lack of talented individuals to fill these positions.
The third edition of the India Board Report focuses on the functioning of corporate boards in India. ValueNotes was commissioned by Hunt Partners to identify and compare trends in governance practices pursued by Indian companies. The research report highlights the implementation challenges faced, and presents the views of independent directors on ways to improve board performance and effectiveness.
To download a complimentary copy of this research report, please follow this link