In AI age, India Inc gets young on board as independent directors
Mumbai, Aug 21, 2023
India Inc is making its boards look younger.
At 31, Binoy Parikh, an executive director at Katalyst Advisors, was recently named the youngest independent director in India Inc. Sarda Energy & Minerals, with a market capitalization of over Rs 6,600 crore, took Parikh on board.
At 34, Upasana Kamineni Konidela, MD of Family Health Plan Insurance TPA, was inducted as the youngest woman independent director by the Rs 65,000-crore market cap company, Zydus Lifesciences. Konidela is the granddaughter of Apollo Hospitals founder Prathap Reddy.
At 34, MapmyIndia CEO RohanVerma joined Cholamandalam Investment and Finance Company, which manages assets over Rs 75,000 crore, as an independent director four years ago.
In a country where millennials make up the largest share of the workforce, India Inc is trying to board young executives as independent directors. "Bringing on young independent directors adds dynamism and new-age thinking to corporate boards. It also helps in bridging the age diversity gap on the boards of companies," said Parikh.
Embracing age diversity could be a game-changer for many large companies. Organizations focus on age as they look to respond to disruptions in their sectors as well as to the rise of new technologies like blockchain and AI. "While one cannot take away from the wisdom and rich experience of senior independent directors, young individuals have a different perspective in a rapidly changing business environment and consumer profile. They understand digital and related technologies and can advise the board on how these can be used to reach consumers," Parikh added.
Indian boardrooms are rebooting, says Monica Agrawal, MD (financial services - Asia Pacific) at Korn Ferry, an international talent search firm. "The evolving landscape of technology, customer dynamics, and workforce composition has accentuated the value of generational diversity in the boardrooms. Therefore, business leaders in their late 30s and 40s are finding representation on boards, which are actively considering strategies to strengthen their competitive advantage and are thoughtfully incorporating both youthful vigour and mature wisdom by making appointments that augment management team capabilities so that they are a strategic asset," Agrawal added. In March, Sharekhan BNP Paribas Financial Services roped in Arjun Mohan (37), former CEO of UpGrad, as an independent director.
The boardroom experience is helping young leaders gain valuable lessons early on in their careers. "My experience as an independent director at Chola has certainly helped me in MapmyIndia's journey as a public company. We could execute a successful IPO in 2021 and have also been able to manage well as a public company post-IPO," said Verma.
More than 800 independent director positions will open up in a year's time. This is because Sebi mandates that independent directors can stay on the board for no more than two five-year terms. Companies, then, can look to fill seats with younger candidates. "The demographics for India as a market suggest that almost 75% of the population is under 40 years. To understand the behaviour of this segment, their aspirations, and their needs, the boardroom should also have this representation," said Suresh Raina, partner, Heidrick & Struggles, an international talent search firm.
For now, the statistics remain grim, indicating a long way to go. Only 46 independent directors of Nifty 100 companies were below 50 years as on March 31, 2022 while 480 independent directors were between 50 and 75 years and about 30 were above 76 years, according to a report published by Excellence Enablers in April. The report said that given the pace and the nature of change in the economy and in the corporate world, the induction of younger persons will increase the relevance of boards.
[The Times of India]
