Board EffEctivEnEss: an Evaluation BasEd on corporatE GovErnancE scorE Hitesh Shukla*, Nailesh Limbasiya** Abstract Growth, progress, and prosperity of any country depend highly on the corporate governance mechanism of that country. Good governance of a country helps it to sustainable growth and consistency in progress. The good governance should contribute towards the improvement in transparency, ethics, morality, and disclosure. The principles of good governance stand on honesty, trust, integrity, openness, and performance orientation. Our honorable Prime Minister Narendra bhai Modi had given the three “E” for good governance during his speech on Independence Day i.e. Effective Governance; Electronic Governance, and Ethical Governance. The fundamental concern of corporate governance mechanism is to ensure the protection of minority shareholders/owners of speciic irms. Mechanism of a corporate governance speciies the relations among the shareholders, board of directors, and managers. The present paper is an attempt to evaluate the effectiveness of the board by calculating the corporate governance score. The mandatory and non-mandatory guidelines have been considered while assigning points to speciic parameters of the corporate governance. Keywords Board of Directors, Board Effectiveness, Independent Director, Corporate Governance INTRODUCTION The effective board demands culture of transparency and accountability. Study of Ana Dutra (2012) found the four phase continuum to progress of board from good to the great i.e. foundational, developed, advanced, and strategic. The effectiveness of board is determined based on the agreement and alignment of board on this continuum. The continuum indicates the corporate hierarchy of needs. A foundational board provides basic compliance oversight, like basic needs of survival in Maslow’s need hierarchy. It focuses on the fulillment regulatory requirement for compliance purpose only. Such boards are low performing, passive and play in safe.On the contrary, a strategic board provides futuristic outlook to the irms’ essential strategy. Such boards are high performing boards. Here, directors of the board take the risk to make signiicant contributions for sustainable grow of enterprise. Weak board is observed with lack of clarity, poor process management, lack of alignment and agreement on company strategy, and poor team dynamics. Effective boards are high performing boards. Composition of board and level of diversity in board suggest the “talent-centric” approach of the board. Here, diversity is not only in terms of age, gender, geographies, and race but also in terms of knowledge, experience, expertise, and backgrounds. Strategic directors are contributing in board by giving constructive inputs for the development of irm and personal development of other directors. SIGNIFICANCE OF THE STUDY Prior studies have analysed board effectiveness as relationship between board characteristics (size, composition, leadership, and independent directors) and a range of inancial performance (ROA, ROE, market-to-book value). The present study contributes to the emerging interest in corporate governance by examining the board characteristics for effective board management. The result of this study is to contribute to the interest of business practitioners, investors, and academics by providing the picture of corporate governance practices in Indian corporates. The results can be further used by corporate decision maker in order to design the composition of their board. The present study contributes to the body of knowledge in this area through examining the board effectiveness of Indian public listed irms. Further, the study addresses the Indian corporate governance issues concerning the characteristics of members of board of directors. The study is also to contribute the understanding of the characteristics of board of directors in Indian irms. The study may become useful for helping nomination committees to select the best criteria while appointing their board members. Finally, the outcomes of this study may contribute to Indian regulators for formulating corporate governance policies in India. * Professor, Saurashtra University, Rajkot, Gujarat, India. E-mail: hshukla72@yahoo.com ** Assistant Professor, R K University, Rajkot, Gujarat, India. E-mail: nailesh.limbasiya@rku.ac.in Article can be accessed online at http://www.publishingindia.com