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Reforms at a structural level are necessary in India’s corporate governance system to enhance transparency, accountability, and efficiency. Analyse.

Topic: Important aspects of governance, transparency and accountability, e-governance applications, models, successes, limitations, and potential; citizens charters, transparency & accountability and institutional and other measures.

3. Reforms at a structural level are necessary in India’s corporate governance system to enhance transparency, accountability, and efficiency. Analyse. (250 words)

Difficulty level: Moderate

Reference: moneycontrol.com

Why the question:

The article discusses how the Reserve Bank of India (RBI) has identified deficiencies in corporate governance practices at banks, despite the existence of guidelines. The RBI Governor highlighted the importance of strong corporate governance in maintaining the stability and integrity of the banking sector.

Key Demand of the question:

To write about the reforms that are needed in corporate governance in India.

Directive word: 

Analyse – When asked to analyse, you must examine methodically the structure or nature of the topic by separating it into component parts and present them in a summary.

Structure of the answer:

Introduction: 

Begin by defining corporate governance.

Body:

First, write about the various issues plaguing the corporate governance in India and substantiate with examples.

Next, write about various reforms that are needed to make corporate governance more effective in India – choosing independent directors, diversity in the selection of board members, penalties and effective regulation etc.

Conclusion:

Conclude by writing a way forward.