Spirit of independence

Former Securities Exchange Board of India (Sebi) Chairman M Damodaran had an interesting take on how to infuse a spirit of independence among independent directors in companies. While delivering the 7th Subir Raha Memorial Lecture in New Delhi, Damodaran cited an earlier instance when he was asked to comment on the issue of an independent spirit. “I told the person (asking the question) to put them on the board of United Spirits,” he said. United Spirits was owned by Vijay Mallya before it was taken over by Diageo in 2014 following his loan defaulting troubles. Damodaran said a large number of independent directors belong to the category of dependent directors — they are “dependent on the promoter”.