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2019 India Spencer Stuart Board Index

October 2020

The 2019 India Spencer Stuart Board Index provides an overview of governance practices in India’s largest listed companies by market capitalization. The index analyzes data published by companies listed in the BSE 100 index between June and August 2019.

In addition to our findings, this report includes three special spotlight sections: one featuring a panel of senior board directors discussing board and management responses to the COVID-19 crisis; one on the critical role of the board in CEO succession; and one on board culture.

Highlights from the 2019 India Spencer Stuart Board Index include:

  • Clause 49 of the Listing Agreement on corporate governance came into effect in 2005, calling for independent directors to make up one-third of boards with non-executive chairs and half of boards with executive chairs. Even after 14 years, this critical governance directive still has not achieved 100% compliance.
  • Gender diversity continues to progress at a steady pace in India. Clause 149 in Companies Act 2013 requires at least one women director on listed companies’ boards, and 100% of companies in 2019 achieved that, up from 94% in 2015. Interestingly, 52% of BSE 100 companies have two or more women on their boards. However, women still only account for 16.3% all directors in India.
  • The average remuneration paid to the Independent directors has jumped almost six-fold in the last decade, from INR 540,000 to INR 3.2 million. Remuneration levels need to reflect the risk and responsibility directors assume for the role while rewarding the value they bring to boards.
  • Foreign directors can bring perspectives to the board for more robust discussions and Indian companies continue to invite individuals from overseas to serve on their boards. While 34 per cent of companies surveyed had at least one foreign director on their board, there has been no significant change in the last five years.
  • The number of companies with a non-executive chair increased to 58% from 55% in 2015, in line with the trends of the last few years, where the number of nonexecutive chairs has continued to rise.

Related Insights

Spencer Stuart has long played an active role in corporate governance by exploring key concerns of boards and innovative solutions to the challenges they face.

An interactive exploration of how boards around the world compare in terms of diversity, composition, compensation and more.