All India Management Association (AIMA) 2007 M.B.A Marketing Management Business Ethics

Majority of the Board: In the majority of the board structure nine out of 16, are independent members. In the majority of the board, executive directors have a majority on the board while outside or non-executive directors are in a minority. The non-executive directors are appointed to the board to represent the interests of stakeholder groups like major shareholders employees, customers etc. Sometimes, organizations appoint non-executive directors on the board to bring in the needed expertise, knowledge and experience.
The non-executive directors act as a check on the powers of the majority executive directors on the board. Ideally, there should be more than 1 non-¬executive director on the board to influence the decisions of the executive directors. It is conventional to have one-third of the seats on the board filled by non-executive directors; they put considerable pressure on board decisions by way of resignation if necessary. Infosys has nine out of 16, that is it has more than 1/3rds. Infosys follows this so that they are constantly checked and to exercise good corporate governance.
Further, Infosys also has the subsequent committees which are comprised of independent directors:
Compensation committee: Shareholders are becoming concerned about the lack of transparency regarding the remuneration of directors and top-level managers. The board sets up the remuneration or compensation committee to objectively review the remuneration packages of the executive directors and other top-level managers. This committee, which is made up of independent directors, chalks out the remuneration policy. Such a policy checks the unreasonable increase of executive remuneration.
Nomination Committee: These committees are usually set up to choose the new non-executive directors. Usually, it is headed by the Chairman and it shortlists and interviews the final candidates.
Investor grievance: These committees are usually conducted for the interest of the investors, so that the company’s accounts are transparent and repayments are done on time.
Audit committees: The committee usually consists of independent directors who report to the board. These committees act as a link ranging from the board and the external auditors. The audit committee looks into all the matters raised by the external auditors relating to the management systems and tries to resolve any objections that the auditors raise about the published financial accounts. a few of the functions of a corporate audit committee are:
• To explain with independent auditors any issues that they experience in completing the audit.

Earning:   Approval pending.