Board rules for fair play

Corporate India may not be too thrilled, but Sebi's proposals on independent directors are good for India's governance credentials

The Securities and Exchange Board of India (Sebi) recently came out with a consultation paper, tightening rules for appointments and resignations of independent directors. The proposed rules bring in some much-needed changes as to how independent directors are selected, voted on and possibly even remunerated. There is a clear attempt to correct the balance of power between minority shareholders and promoters, or the operating management, in deciding who is to become an independent director and join the board.

Today, the whole framework of corporate governance is based on the concept of independent directors and their ability to represent the interests of