Both reports point to a clear shift in the role and expectations of corporate boards in India, from a largely compliance-driven function to one that is increasingly strategic, accountable, and performance-oriented. While progress is evident, significant gaps remain between regulatory intent and boardroom reality.
The report of IiAS focused on board effectiveness beyond formal structures. It found that while most listed companies comply with regulatory requirements on board composition, independence, and committees, effectiveness hinges on board processes, culture, and the capability of individual directors. Boards often struggle to move beyond passive oversight to actively challenging the management. Chairpersons play a pivotal role, yet at the time of writing this report, many boards lacked a clear separation between governance and management, particularly in promoter-led companies — an infirmity that persists. Director selection is frequently driven by familiarity and trust rather than skill diversity, leading to gaps in areas such as technology, risk management, and industry disruption. Board evaluation is increasingly conducted, but it is often perfunctory, inward-looking, and insufficiently linked to board renewal or exits of directors.
While these findings date back to the period immediately following the rollout of the Companies Act, 2013, the regulations on the “Listing Obligations and Disclosure Requirements” of the Securities and Exchange Board of India had not yet come into effect, and the recommendations of the Kotak Committee on Corporate Governance, which positioned boards as a critical instrument for driving governance, had not yet been formulated.
Even so, several of the identified characteristics appear to have taken hold, as reflected in the ISB report (January 2026). The study “shines a light on patterns of behaviour, decision-making, and leadership that determine whether boards merely comply or truly govern”. Its findings point to a familiar theme in Indian corporate governance: Meaningful regulatory reform, but uneven substantive outcomes.
The ISB report notes improvement in gender diversity, attendance, and committee structures, driven largely by regulation and investor scrutiny. However, it underscores that “diversity of thought and experience still lags”, with boards remaining dominated by former executives, bureaucrats, and promoter nominees. Independent directors face structural constraints, including information asymmetry, time limits, and reliance on management for setting the agenda, weakening their ability to exercise objective judgment. The report also flags the growing complexity of board responsibilities — covering ESG (environment, social, and governance), cyber risk, capital allocation, and succession — without a commensurate upgrade in board capability or training.
A key common insight across both studies is that board effectiveness is shaped more by behaviour than by form. Information quality, agenda design, depth of discussion, and psychological safety determine whether boards act as robust stewards or rubber stamps. Both reports observe that dissent in Indian boardrooms remains rare, and consensus is often achieved through deference rather than rigorous debate. This is particularly pronounced in family-controlled and founder-led firms, where informal influence can override formal governance mechanisms.
Another shared finding is the underutilisation or improper use of board evaluation and poor succession planning. While evaluation is widely mandated, disclosure is patchy and it rarely results in tangible outcomes such as director rotation, skill refresh, or leadership transition. Succession planning for chief executive officers and key executives is often reactive rather than institutionalised, posing long-term risks. And in family-owned businesses, boards view the next generation as natural successors, prioritising family continuity over experience or skill, and in the process end up viewing the board as a training ground.
Both reports, despite the time gap between them, converge on the view that India’s corporate boards are at an inflection point. Regulatory compliance can push only so far and the next phase of governance reform must focus on board capability, independence of mind, leadership quality, and performance accountability. Governance requires a degree of discomfort and for boards to be a space of constructive tension; value-adding boards will require intentional changes in how directors are selected, how boards function, and how effectiveness is measured and acted upon.
Taken together, the IiAS-Vahura report and the ISB study suggest the central challenge facing boards today is not a lack of rules but the gap between structure and spirit — and equating compliance with governance. Collectively, these reports suggest that the next phase of governance reform must move decisively beyond box-ticking and towards boards where assumptions are challenged, information is scrutinised, and dissent is an integral part of the deliberations – in short, boards that serve as genuine stewards.
The author is with Institutional Investor Advisory Services India Ltd. Views are personal. X: @AmitTandon_in
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