Determinants of Board Structure: Evidence from India

Abstract

The paper analyse the role of directors in sustainability of business to ensure good corporate governance. The objective is to highlight the economic and strategic implications of independent role of directors with regards to regulatory framework in India in the light of major corporate governance failure at India's fourth largest software company, Satyam Computers in January 2009. The present paper highlights the long-term strategic perspective for India as far as corporate governance and business sustainability are concerned. The data set consist of nifty companies, from Prowess corporate data base. The paper tries to analyse the impact of various company characteristics and board size on independence of directors. The findings include analysis of role of independence in decision making of corporate including director as far as overall governance is concerned and possible recommendations for future so as to carve out a voluntary good governance culture on a large scale among corporate entities. There is lack of reliable data on various aspects of governance and independence of director. Therefore, the study focused on the availability of data and compliance to regulatory framework in India along with future implications as regards to new Companies Act 2013. All stakeholders including government, investors, corporate sector, regulatory bodies and citizens need clarity on the role of directors, and other key managerial personnel in sustainability of interest of all the stakeholders and overall growth of corporate in India. In India, there is dearth of research in the area of corporate governance practices. This paper aims at highlighting the historical relationship between independence of directors; and overall business sustainability.