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83% Indian Boards Lack Strategic Input, Survey Finds
5 Jan
Summary
- Only 17% of Indian corporate boards actively shape strategy.
- 83% of boards are passive, merely reviewing management plans.
- Directors cite limited input beyond compliance and reviewing plans.
A recent survey of directors from India's largest listed firms indicates that a mere 17% of corporate boards actively engage in shaping company strategy. The overwhelming majority, 83%, are found to be largely passive, focusing on compliance rather than strategic input.
This finding, from the Indian School of Business, highlights a disconnect between regulatory adherence and strategic influence. Many directors admit to providing limited input beyond reviewing management's plans, underscoring the need for boards to transition into active stewards of long-term value.
Issues such as information dependence, a lack of openness with management, and weaknesses in committee functions, particularly CEO succession planning, further contribute to the boards' limited strategic effectiveness, suggesting a critical need for enhanced independent thinking and proactive engagement.
