Panel would review regulatory norms on bank ownership, ownership concentration and representation in the board and also examine board compensation guidelines
MUMBAI : The Reserve Bank of India has constituted a committee to review governance of boards of banks in India. The panel will assess regulatory compliance requirements of banks’ boards as well as the ‘fit and proper’ criteria for all categories of directors of banks.
The panel, chaired by former Chairman and Chief Executive Officer of Axis Bank P.J. Nayak, would examine the working of banks’ boards, including assessing whether adequate time is devoted to issues of strategy, growth, governance and risk management.
The committee is expected to submit its report within three months from the date of its first meeting, the RBI said. The panel would review regulatory guidelines on bank ownership, ownership concentration and representation in the board and also examine board compensation guidelines.
“(The panel would)…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,” the RBI said in a release.
“In this regard to also assess and review the ‘fit and proper’ criteria for all categories of directors of banks, including tenor of directorship;” The members of the panel include Securities and Exchange of India’s Whole Time Member S. Raman, Allahabad Bank Chairperson and Managing Director Shubhalakshmi Panse, McKinsey & Co Director Joydeep Sengupta and Indian School of Business Assistant Professor Krishnamurthy