Independent directors are the cornerstone of good corporate governance

Independent directors are the cornerstone of good corporate governance, President of World Council for Corporate Governance, Dr Madhav Mehra says

We are yet again breeding a culture of greed. One third of a listed company's directors are required to be independent. The erstwhile Company's (Amendment) Bill 2003 had stated that a majority of the minimum seven directors of public companies having share capital in excess of Rs. 5 crore should be independent. Clause 49 of the listing agreements defines independent directors as follows: "For the purpose of this clause the expression 'independent directors' means directors who apart from receiving director's remuneration, do not have any other material pecuniary relationship or transactions with the company, its promoters, its management or its subsidiaries, which in judgment of the board may affect independence of judgment of the directors."

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