Corporate Governance Trends in India

Back to Global Corporate Governance Trends for 2025

Backdrop of an evolving technology landscape

Given the insurgency of start-ups in India—with newer, technology-led business models challenging incumbents—boards are continuously scanning the competitive landscape. At the same time, AI continues to create new opportunities in business prospects and operational efficiency, as well as new risks regarding data integrity, IP infringement, and responsible usage. Boards are worried that companies' dependence on technology is at an all-time high, creating an opening for something to go wrong – outages, business disruption, data breaches, and cybersecurity threats. In response, boards should plan for a greater focus on risk management mechanisms and oversight on their 2025 agenda.

Continued spotlight on start-up governance and broader governance ecosystem

Many global venture capital and private equity funds investing in the Indian start-up ecosystem have faced significant governance challenges with founder teams. Given increased capital market activity, experts suspect institutional investors will continue to increase their pressure on governance, including demands for seasoned CEO experience and relevant skills within start-up boardrooms.

Beyond start-ups, and in context of listed companies, proxy advisors are also increasingly getting their voices heard in shareholder meetings – whether this be related to promoter compensation, director appointments, or related party transactions. This trend is likely to continue in 2025.

Ongoing focus on geopolitics in the boardroom

A volatile global environment and real-life impact on businesses in India has ensured that geopolitics has earned a permanent seat in the boardroom.  While this creates opportunities for businesses (such as a “China plus one” strategy for diversifying manufacturing and sourcing operations), it also creates a number of risks, especially in areas like crude supplies and high-tech imports. Boards will need to stay on top of these geopolitical movements with greater interest and further assess the ramifications of election outcomes and regional conflicts on their businesses. Domestically, the regulatory ecosystem in India has been extremely active in the past few years and such regulatory tightening is expected to continue in 2025.

Adapting to shifts in consumer behaviors

Rising disposable incomes, telecom penetration, digital revolution, and disruptive business models have increased competition, leading consumers to purchase differently than they have in the past. Customer loyalty can no longer be taken for granted. With each passing generation, the Indian business landscape is witnessing a pace of change and appetite to experiment that is growing by leaps and bounds. Experts advise that companies and their boards reassess their strategic go-to-market blueprints and right-to-win amidst this dynamic demographic transformation.

Early headwinds on the board’s role in overseeing culture

As societal debate continues around future ways of working, reputational risk, and rightsizing, organization culture is increasingly finding its way into the boardroom agenda. Though such discussions are mainly topical at this point, the movement is gathering traction. More than ever before, boards can expect to grapple with enterprise-wide corporate culture and how it is strategically being infused into the way business is conducted.