K M Birla Committee suggested are that not less than ________ of the board should comprise of non-executive directors.a.0.33b.0.5c.0.4d.0.25
Question
K M Birla Committee suggested are that not less than ________ of the board should comprise of non-executive directors.
a. 0.33
b. 0.5
c. 0.4
d. 0.25
Solution
The K M Birla Committee on Corporate Governance, established by the Securities and Exchange Board of India (SEBI), recommended specific guidelines for the composition of the board of directors of companies. One of its key suggestions was related to the proportion of non-executive directors on the board.
Final Answer
The correct answer is b. 0.5. According to the recommendations of the K M Birla Committee, at least 50% of the board should consist of non-executive directors, especially for companies that have an executive chairperson. This guideline is aimed at ensuring a balance of power on the board and promoting better governance practices by involving independent perspectives in decision-making.
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