released by bis, should be a compulsory reading for all the regulators concerned and all the directors on the boards of the banks. the point to be noted is that corporate governance should be viewed as an ongoing process subject to rapid changes based on experiences, developments and policy - setting. there is considerable divergence in the understanding and practice of corporate governance in general, and in respect of banks, in particular, but there is also an increasing tendency towards convergence. the cultural context may be difficult to capture but the legal, institutional and attitudinal contexts do vary perceptibly across countries. differences can be noticed even amongst the industrialised countries – say between anglo - saxon, european and japanese situations. at the same time, the trend towards greater convergence is for several reasons. the corporates are getting listed in multiple stock exchanges in different countries and carry out corporate operations in several jurisdictions while the cross - border financial flows seek an assurance of some commonly understood standards of governance, which have a mutually reinforcing tendency. banks, in particular, have been a subject of special interest for governance, especially in view of their fiduciary role. the cross - border operations of banks provide an added impetus for convergence in such standards. public policy framework in regard to corporate governance typically involves multiplicity of agencies in all countries. for instance, in india, these are department of company affairs ; securities and exchange board of india in respect of listed entities apart from the banking regulator in respect of banks. harmonising their policies in a dynamic setting is a daunting task for policy makers and adds to the complexities of the corporates or banks concerned to ensure compliance. in regard to sectors such as banking in india where ownership of government is dominant, there are additional issues. government, as an owner, is accountable to political institutions in terms of broader socio - economic objectives and hence, its goals may not necessarily be compatible with purely economic incentives. mixed ownership, with the government as a major shareholder, brings into sharper focus the possible divergent objectives of share - ownership in a corporate or a bank and issues relating to the rights of minority shareholders. the problem gets more complex if public ownership is exercised through separate legislation and not under the company law, normally applicable to other competing entities. the role of directors in such divergent organisational settings, therefore, needs a nuanced appreciation. let me end these general observations with an anecdote. when i was working in the world bank in late 1970s

and expanding importance in our financial sector. conclusion let me conclude with a reiteration that the reserve bank is continuously striving to ensure compliance with international standards and best practices of corporate governance in banks as relevant to india. rbi is also interacting closely with the government and the sebi in this regard. increasing regulatory comfort in regard to standards of governance in banks gives greater confidence to shift from external regulation to internal systems of controls and risk - management. each of the directors of the banks has a role in continually enhancing the standards of governance in banks through a combination of appropriate knowledge and values. thank you.