Fulfilling Broad Mission and Purpose
THE GOVERNING BOARD of Western companies has traditionally been viewed as the owners’ eyes and ears, ensuring that company executives take prudent risks to optimize investor value and engage in no self-serving behavior or malfeasance while doing so. But drawing on the broad sense of mission and purpose that defines the India Way, Indian directors have become more deeply engaged in guiding company directions with less of an eye or an ear on the shareholders and more of a concern for the community and the country.
The conventional American model of corporate governance is notable for its formal clarity and conceptual simplicity. Company directors are elected by the firm’s stockholders—one ...