Future-Ready: India’s corporate governance framework has made visible progress over the years, with boards becoming more structured, diverse, and aligned with regulatory expectations. However, recent insights suggest that structural strength alone is no longer sufficient in an increasingly complex and globalised business environment. To remain competitive and resilient, Indian corporate boards must evolve beyond a compliance-driven mindset and adopt a more proactive, strategic, and forward-looking approach to governance.
A recent study conducted by Indian School of Business highlights a critical gap between formal board responsibilities and actual strategic involvement. While most boards meet statutory requirements and maintain procedural discipline, only a small proportion actively contribute to shaping long-term corporate strategy. The majority continue to function as passive reviewers of management decisions rather than as engaged partners in value creation. This gap limits the board’s ability to influence innovation, growth, and risk preparedness in a rapidly changing market landscape.
One of the most significant findings of the study is that only a fraction of Indian corporate boards take an active role in defining company strategy. A large majority remain confined to approving proposals already formulated by management. This passive participation reduces the board’s relevance in steering the organisation through uncertainty, competition, and technological disruption. When boards do not challenge assumptions or offer alternative perspectives, strategic decisions risk becoming narrow and short-term focused.
The study further reveals that more than one-third of directors acknowledge that their boards provide little to no input beyond reviewing management plans. This admission underscores a deeper behavioural issue where directors may hesitate to question executives or lack the time and information required for meaningful engagement. Such a dynamic weakens governance effectiveness and undermines the board’s responsibility to safeguard long-term stakeholder interests.
According to Sanjay Kallapur, Professor of Accounting at ISB, effective oversight requires directors to anticipate risks and guide leadership with clarity and conviction. As Indian companies expand their global footprint, boards must be equipped to address cross-border risks, sustainability challenges, and evolving regulatory standards. A forward-looking board does not simply react to events but actively prepares the organisation for future scenarios through strategic foresight and informed judgment.
The findings are based on a comprehensive survey involving more than 200 directors from companies listed in the BSE 500. The study evaluates governance maturity across key dimensions such as guidance and oversight, board processes, and leadership effectiveness. It also reviews the performance of critical committees, including audit, risk management, and nomination and remuneration committees. This broad-based approach provides a realistic picture of how boards function in practice rather than in theory.
In his foreword, Professor Madan Pillutla, Dean of ISB, notes that the survey sheds light on behavioural patterns and leadership styles that determine whether boards merely comply with regulations or truly govern. Decision-making quality, openness to debate, and willingness to engage with uncomfortable questions emerge as defining factors of governance maturity. Boards that encourage diverse viewpoints and constructive dissent are better positioned to avoid strategic blind spots.
Another critical concern highlighted by the study is the limited use of independent information sources by directors. Only a small percentage actively seek insights beyond management-provided data. This reliance creates an echo chamber where similar perspectives are reinforced, increasing the risk of groupthink. Without external benchmarks, industry intelligence, or independent expert views, boards may fail to recognise emerging threats or opportunities in time.
Nirmalya Kumar, Visiting Professor of Strategy at ISB, emphasises that true governance maturity lies in fostering boardrooms that value preparation, perspective, and the courage to ask difficult questions. Directors must feel empowered to challenge prevailing assumptions and explore alternative strategies. This cultural shift requires strong leadership from the chairperson and a shared commitment to long-term organisational health.
The study also points to uneven performance across board committees. While audit committees demonstrate strength in financial oversight and compliance, their engagement with whistleblower mechanisms, ethical conduct, and behavioural risks remains limited. These softer aspects of governance are increasingly important as corporate reputation, trust, and culture become key drivers of sustainable success.
To become truly future-ready, Indian corporate boards must invest in continuous learning, deeper industry understanding, and stronger engagement with management. Moving beyond procedural oversight to strategic stewardship will enable boards to guide organisations through disruption, global expansion, and stakeholder expectations. The path forward lies in transforming boards into active contributors who shape strategy, manage risk proactively, and uphold long-term value creation.
