Corporate Governance and Economic Development

5The Importance of the Family – Lessons From India

DOI: 10.4324/9780429443459-5

In principle India’s corporate governance system is based on the model that focuses on shareholders with directors assigned clear fiduciary duties and commitments made to high disclosure, transparency, and accountability standards. In practice, the corporate governance practices had been compromised by the perseverance of powerful conglomerates with preference for autonomous and informal management structures. India’s business groups continue to derive benefits from concentrated ownership, informal family-based management structures, subsidiaries organized as pyramid schemes, and the historically constructed relationship with government officials. The persistence ...