India Inc wants MNC execs, NRIs on board

India Inc wants chief executive officers (CEOs) of multinational companies (MNCs) and non-resident Indians (NRIs) on the boards of domestic companies to help them integrate with the global corporate culture, according to a survey of 100 large scale corporates conducted by Associated Chambers of Commerce and Industry of India (Assocham) and Asian Centre for Corporate Governance (ACCG).

The survey recommended that the Indian statute should not restrict the movement of domestic corporate giants to cross its geographical boundaries to join the board in overseas companies.

The survey, disclosed at the Director's Power Breakfast Series 2004 organised by Assocham, pointed out that 90 per cent of the respondents favoured the entry of big corporate foreign nationals and NRIs on the boards.

At present, the law of the land does not automatically allow access of foreign corporate giants and NRIs to hold the board rank position in domestic companies both public and private.

H W Bhatnagar, director (IS&P) BHEL and Assocham were of the view that there should not be any taboo as such personalities bring in with them huge experience and global vision to strengthen the corporate governance.

Also, there should also be the liberty for Indian corporates to go overseas and join the board of any MNCs while retaining positions in Indian business. Nearly 60 per cent of the respondents endorsed these observations.

On the issue of average remuneration for directors, 40 per cent of the respondents felt that it should be within the range of Rs 9 lakh per annum, while 30 per cent said that directors rank executives annual remuneration should be within the range of Rs 6 lakh per annum.

Also, 15 per cent of the respondents were of the opinion that the remuneration range should exceed the amount of Rs 10 lakh per annum.

On the issue of retiring age for directors, 55 per cent of the respondents felt that the retiring age should be 65, while 30 per cent of the respondents favoured 70.

However, 15 per cent of the respondents supported that the retiring age for the members of board level officers should be 75 years.

Meanwhile, M K Chouhan, vice-president of Global Advisory Board said to develop a disciplined cadre-based system in the Indian corporate sector, majority of the respondents opined that management gurus, consultants, business school professors should be called upon to hold the position of directors.