Corporate governance at private banks is generally considered to be stronger than at state-owned banks as the former have better-qualified board members and more professional management. A large and diversified investor base also encourages greater management accountability. This conventional wisdom, however, has taken some hard knocks over the last few days, going by the recent conduct of the boards of two of India’s largest private sector banks — ICICI Bank and Axis Bank. Some of the most formidable names in Indian industry and financial world surely could have given a better account of themselves when crisis hit their respective organisations.
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