Attracting Independent Directors For Family Businesses
This article has been excerpted from Grant Thornton’s newsletter ‘Aspire’. It is authored by Lav Goyal, Partner - Business Risk Services, Grant Thornton India.
September 22, 2011 / 18:01 IST
How To Attract Professional Independent Directors For Your Family Business?
This article has been excerpted from Grant Thornton's newsletter 'Aspire'. It is authored by Lav Goyal, Partner - Business Risk Services, Grant Thornton India."The outside world view and unbiased opinion that independent directors bring to a company far outweighs the (mis)perceived loss of control in the board."It is desirable for a family business to establish a board or a council in which independent directors constitute a majority. However, owners and families may find it hard to cede control, until they have experienced the benefits of independent directors over a long period of time. In fact, the by-laws of a family enterprise may ensure family control even if there is a majority of independent directors on the board by providing for the removal of directors if the shareholders believe their interests are not being adequately served. Thus, a family enterprise can enjoy the benefit of having objective outsiders controlling the board without risking the unwanted loss of ownership control. However, once you decide that you want independent directors on your company
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
