A Study of the Role of Independent Directors and Gender Diversity in Indian Banking Industry

Abstract

newline A corporate board is the apex governing body of a company. They are appointed by newlineand represent the shareholders and other stakeholders of the company and are newlineaccountable to them. The board usually lays down broad objectives and overall policies newlineof the company, leaving day to day administration to other executives. The position of newlinethe directors can be regarded as of agents, trustees, managing partners and officers of newlinethe company. As it is the board of directors that have the final say in the matters of the newlinecompany, presence of an effective and efficient board is a fundamental requirement for newlinethe success of the corporation. One of the many vital aspects of corporate boards is the newlinecomposition of board of directors of the company. What constitutes the board of a newlinecompany is referred to as board composition. It specifically relates to the board newlineindependence, chairman/CEO duality and diversity of the board of directors. There are newlinedifferent types of directors as mentioned in the Companies Act, 2013 and Clause 49 of newlinethe Listing Agreement. One of the categories of such directors are the independent newlinedirectors. As defined by the Companies Act 2013, an independent director is the one newlinewhich is an outside director, is not a managing director, a whole-time director or a newlinenominee director and does not have any pecuniary relation with the company. Whereas, newlinegender diversity refers to the presence of both male and female directors on board.