RBI appoints a Committee to Review Governance of Boards of Banks in India

The Reserve Bank of India has constituted an Expert Committee to Review Governance of Boards of Banks in India.

The Committee would be chaired by Shri P. J. Nayak, former Chairman and CEO of Axis Bank; the other members being Shri S. Raman, Whole Time Member, Securities & Exchange Board of India, Smt. Shubhalakshmi Panse, Chairperson & Managing Director, Allahabad Bank, Shri Pratip Kar, former Executive Director, Securities & Exchange Board of India, Shri Joydeep Sengupta, Director, McKinsey & Company, Shri Harsh Vardhan, Partner, Bain & Company India Pvt. Ltd., Shri Somasekhar Sundaresan, Partner, J. Sagar Associates, and Shri Krishnamurthy Subramanian, Assistant Professor, Indian School of Business.

The terms of reference of the Committee would be:

to review the regulatory compliance requirements of banks’ boards in India, to judge what can be rationalised and where requirements need to be enhanced; to examine the working of banks’ boards including whether adequate time is devoted to issues of strategy, growth, governance and risk management; to review central bank regulatory guidelines on bank ownership, ownership concentration and representation in the board;

to analyse the representation on banks’ boards to see whether the boards have the appropriate mix of capabilities and the necessary independence to govern the institution, and to investigate possible conflicts of interest in board representation, including among owner representatives and regulators. In this regard to also assess and review the ‘fit and proper’ criteria for all categories of directors of banks, including tenor of directorship; and to examine board compensation guidelines, and any other issue relevant to the functioning of banks’ boards and the governance they exercise.

The Committee is expected to submit its report within three months from the date of its first meeting.

Alpana Killawala

Principal Chief General Manager

Press Release : 2013-2014/1450