In a move to improve governance in banks the RBI has proposed stronger boards and also stringent norms for chief executive officers and whole-time directors. These norms apply to private banks, foreign banks as well as public sector banks. In a discussion paper on governance on commercial banks in India, the RBI has also suggested the empower the bank board to set up culture and values of the organization, recognize and manage conflicts on interest, set the appetite for risk and manage risks within the appetite and improve the supervisory oversight of senior management. The article further discusses the norms as highlighted in this white paper. The new norms are expected to come into effect within six months after being placed on the website of RBI. This news is related to the topic Indian economy of GS 3. This news is important for mains and prelims both.
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