The Reserve Bank of India (RBI) has constituted an expert committee to review governance of boards of banks in India. The committee would be headed by PJ Nayak, former chairman and CEO of private sector lender Axis Bank, RBI said on Monday.
The panel has been given mandate to review the regulatory compliance requirements of Indian banks and to find out what can be rationalised and where requirements need to be enhanced.
The committee would also be responsible to examine the working of banks’ boards like the time they devote 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,” RBI said.
It will also check the representation of banks’ boards to evaluate whether the boards of banks have the kind of capabilities and required independence to run the institutions.
The committee will also look into possible conflicts of interest in board representation, including among owner representatives and regulators.
Apart from this, board compensation norms, issues pertaining to the functioning of the boards of the banks and the governance they adopt, will be examined by the panel.
Other members who are part of the committee include Shubhalakshmi Panse, chairperson and managing director at Allahabad Bank; S Raman, whole-time member of SEBI; Pratip Kar, former executive director of SEBI; Joydeep Sengupta, director at McKinsey & Company; Harsh Vardhan, partner at Bain & Company India; Somasekhar Sundaresan, partner at J Sagar Associates and Krishnamurthy Subramanian, assistant professor at Indian School of Business.
The panel is expected to submit its report within three months of the first meeting.
(Edited by Joby Puthuparampil Johnson)