I done this presentation during my master degree, year 2009.

2. WHO ARE BOARD OF DIRECTORS?
 It’s a body of elected or appointed members who jointly
oversee the activities of a company or organization. The
body sometimes has a different name, such as “Board of
trustees”, “Board of governors”, “Board of managers”, or
“Executive board”

3. WHY THE BOARD IS NEEDED?
 The Board of Directors has important
responsibilities to the shareholders of the company.
The Board is responsible for the overall
management and effective functioning of the bank.
The banks, being a corporate entity, the Board of a
bank is responsible to the shareholders.

4. WHO ARE ALL REPONSIBLE?
 Banks being important participants in the payment
systems, it is enjoined upon the Boards to
safeguard the interests of the depositors and other
stakeholders. The Board, however, cannot be
expected to supervise the day-to-day operations of
the bank and it, therefore, delegates and entrusts
appropriate authority to the various
functionaries, via
 the whole -time directors of the Board such
as, Chairman, Managing Director and Executive
Directors. This makes each whole-time
director, individually, and the
Board, collectively, responsible for the performance of
the bank.

5.  The general
superintendence
and direction of the
affairs and business
of the bank are
entrusted to a
central board of
directors consisting
of 20 directors,
including:
 A governor & 4 deputy
governor
 4 directors for each 4
local boards.
 10 directors who are
expert in
business, industry, fin
ance and co-operation
 1 official nominated
by the govt.

6. RBI BOARD OF DIRECTORS

7. Structure

8. MDM Bank
 The Board of Directors principal goal has always
been to represent the interests of the Bank’s
shareholders and other stakeholders. It achieves
this objective primarily by maintaining
responsibility for the Bank’s overall strategy and
overseeing mechanisms for supervision and
control.
 The agenda of every Board of Directors meeting
and key decisions thereof are communicated to
employees via various channels, ranging from
Intranet announcements regarding operational
decisions to face-to-face meetings and
presentations about strategic decisions.

10. Major Duties of Board of Directors
 Provide continuity for the organization
 Select and appoint a chief executive
 Govern the organization by broad policies and
objectives,
 Acquire sufficient resources for the organization's
operations
 Account to the public for the products and
services of the organization and expenditures

11. Major Responsibilities of Board of
Directors
1. Determine the Organization's Mission and Purpose
2. Select the Executive
3. Support the Executive and Review His or Her Performance
4. Ensure Effective Organizational Planning
5. Ensure Adequate Resources
6. Manage Resources Effectively
7. Determine and Monitor the Organization's Programs and
Services
8. Enhance the Organization's Public Image
9. Serve as a Court of Appeal
10. Assess Its Own Performance

12. The Code is intended to provide guidance
and help in recognizing and dealing with
ethical issues and to help foster a culture
of honesty and accountability. Every
Director is expected to read and
understand this Code and its application
to the performance of his or her
duties, functions and responsibilities.

13.  (i) Represent the interests of the shareholders of the Company;
 (ii) exhibit high standards of integrity, commitment and
independence of thought and judgement;
 (iii) dedicate adequate time, energy and attention to ensure the
diligent performance of his/her duties including make all
reasonable efforts to attend Board or committee meetings;
 (iv) comply with every provision of this Code; and
 (v) ensure that all employees shall be treated with equal respect
and dignity and shall be provided with equal opportunity to develop
themselves and their career

14.  COMPLIANCE OFFICER
 COMPLIANCE WITH APPLICABLE LAWS
 CONFLICTS OF INTEREST
 CORPORATE OPPORTUNITY
 CONFIDENTIALITY
 FAIR DEALING
 PROTECTION AND PROPER USE OF COMPANY
ASSETS
 REPORTING ANY ILLEGAL OR UNETHICAL
BEHAVIOUR
 PUBLIC COMPANY REPORTING
 AMENDMENT, MODIFICATION AND WAIVER

15. DOS
 Discipline &
Involvement
 Constructive &
Development Role
 Business Specific
Contribution
DON’TS
 Non-Interference
 No Sponsorship
 Confidentiality

16. Banking Regulation Act 1949
• The banking laws (amendment) act,1968
inserted new provisions under sections 10A,B,C
and D regarding the
constitution of the board of directors
Appointment of the chairman

17. Constitution of the board of directors
• Sec 10A- eligibility of person who may appointed
as directors. Every company is required to
constitute its board of directors in such a way
that not less than 51% of the total number of
members of the board shall consist of persons
who satisfy the following two conditions:
▫ Having special knowledge
▫ Do not have substantial interest

18. • The BOD shall reconstitute the board to ensure
the above requirements are fulfilled.
• Acc to sec 2A, inserted in 1983, the director of
the company shall not hold the office for a
period of exceeding 8 years
• And if the chairman or whole time director is
removed or cease to be a director .he is not
eligible to re-appointed as a director of such
banking for a period of 4 year.
• Prohibition of common directors-section 16

19. Appointment of chairman
• Section 10B provided one of its directors as the
chairman of the board of directors who shall
entrusted with the management.
• The chairman is required to be in the whole time
employment of the banking company
• He shall not hold the office for a period not
exceeding 5 years as the board may fix, he shall
be eligible for re-election or re-appointment.

20. • Sub-section 4 prescribed that the chairman shall
be a person who having special knowledge and
practical experience of the working of a banking
company or the SBI or its subsidiaries of a
banking company etc…
• The election or appointment of chairman must
be to the satisfaction of the RBI.
• Section 15A or 15 B not required to hold
qualification shares.

21. • Section 10C and 10D prohibits any person
removed by under the above sections from the
claiming any compensation for loss or
termination of office.

22. RBI control over top management of
banks
• Section 12A - to call a general meeting of the
shareholders
• section 35B - to take prior approval for appointment
• Section 36AA – to remove the top management
personnel
• Section 36AA(6) - to appoint a suitable person for
the removed place by RBI
• Section 36AB – appoint one or more additional
directors
• Section 36AC - sec.36AA and 36AB shall not effect
or contrary conduct contained in the companies act
or other law for the time being

23.  The Group is of the view that the existing level of remuneration
paid (by way of sitting fees, etc.) to directors of banks and
financial institutions is grossly inadequate, by contemporary
standards, to attract qualified professional people to their
Boards, and expect them to discharge their duties as per the
mutually agreed covenants.
 A few of the banks / FIs have modified their compensation plans
to include a base salary, performance bonus and options to their
directors. In order to get quality professional people, the level of
remuneration payable to the directors should be commensurate
with the time required to be devoted to the bank's work and also
to signal the appropriateness of remuneration to the quality of
inputs expected from a member.
 The remuneration of the directors may also include the form of
stock option.

24.  Sec 11contains 2/3rd of directors appointed
by central government.
◦ Chairman & managing director (by govt.)
◦ 2 executive directors(by govt.)
◦ Representative of employees of the bank (by govt.)
◦ 5other directors representing various sector of the
economy (by govt.)
◦ 3 directors appt by shareholder at annual general
meeting.

25. Union bank of india (board)
 Chairman & Managing
Director
 SHRI M.V.NAIR
 Executive Director
 SHRI T.Y. PRABHU
 SHRI S.Raman
 Government of India
Nominee
 SHRI K.V. EAPEN
 Government of India
nominee on the
recommendation of RBI.
 SHRI K. SIVARAMAN
 Chartered Accountant
Director
 K.S. SREENIVASAN
 Director representing
Workmen Employees
 WORKMEN DIRECTOR
 Director representing Officer
Employees
DEBASIS GHOSH
 Government Nominee Director
under General Category
SMT. RANI SATISH
 Government Nominee Director
under General Category
 SHRI ASHOK SINGH
 Part-time non-official Director
 Dr. Gulfam Mujibi
 Shareholder Director
PROF. M.S. SRIRAM
Shri Arun Kumar Nanda
Shri.S. Ravi