The Efficacy Of Board Independence In Enhancing Corporate Accountability: A Comparative Analysis Of India And Global Best Practices
- IJLLR Journal
- 18 minutes ago
- 1 min read
Asmita Banerjee & Chandrima Saha, KIIT School of Law, Bhubaneswar
ABSTRACT
Effective corporate governance is built on the independence of corporate boards, which is meant to provide accountability, secure the interests of long- term stakeholders, and protect minority shareholders. Although structural independence of boards in listed firms is required under Indian corporate law, specifically the firms Act, 2013 and SEBI (LODR) Regulations, 2015, there is still a big gap between formal compliance and substantive independence in real-world operations. This study critically evaluates independent directors' operational efficacy in Indian businesses, paying special attention to promoter-dominated organizations. Using comparative analysis of the OECD Principles of Corporate Governance and practices in the United States and the United Kingdom, this study investigates whether independent directors in India have a significant impact on boardroom decisions or if their responsibilities are only symbolic compliance. Through an analysis of regulatory filings, public dissent disclosures, board evaluation reports, and notable corporate failures, the paper investigates the structural, cultural, and procedural barriers that inhibit true independence. It also considers whether institutional mechanisms such as performance evaluations, whistleblower frameworks, and director nomination processes have evolved sufficiently to empower independent directors. The research concludes by offering recommendations to bridge the compliance-substance gap and enhance the role of independent directors as true custodians of corporate accountability in India.
Keywords: Corporate Governance, Independent Directors, Board Accountability, Promoter Dominance, India, SEBI Regulations, Functional Independence, Board Evaluation, OECD Principles.
