This refers to the edit “Just too many meetings” (November 9). The basic purpose of appointing independent directors is to improve corporate governance standards in listed companies. But with individuals having more than one directorship, the benefit of independent directors’ wise counsel is not always available to companies concerned. In this light, the findings of Ingovern Research Services are quite revealing. Many independent directors are either not able to attend all board meetings, or do not devote enough time to do their duty as directors. Thus, the very objective behind appointment of independent directors is defeated.
The question that arises is whether there is any shortage of professionals who can function as independent directors in companies. And, the answer is an emphatic no. But most company promoters want to satisfy the listing requirements, and they want someone who would toe the promoters’ line rather than taking an independent position on governance issues. This is the bitter reality in many listed companies. Hence, if the Securities and Exchange Board of India (Sebi) wants independent directors on boards of listed companies, it may have to rethink its options.
Narendra M Apte Pune
Letters can be mailed, faxed or e-mailed to:
The Editor, Business Standard
Nehru House, 4 Bahadur Shah Zafar Marg
New Delhi 110 002
Fax: (011) 23720201
E-mail: letters@bsmail.in
All letters must have a postal address and telephone number
