INSIDE THE BOARDROOM : How Behaviour Trumps Rationality

The largest private airline in India went bankrupt as did the bank that could not say no to itsborrowers who defaulted on huge loans. Could these disasters have been foreseen if not averted?Would it have helped if the directors on the board had spoken up before the corporate failure?<br><br><i>Inside the Boardroom</i> explores the downfall of these companies and many more in the light of directors’ behaviour and its impact on corporate governance. R. Gopalakrishnan and Tulsi Jayakumar believe that corporate success goes beyond having significant knowledge of accounting rules and governance regulations. They boldly assert that directors’ behaviour in the boardroom is less rational than may be widely believed! Being human directors’ decisions are naturally subjective and prone to behavioural bias especially when confronted with manifestations of power passion and authority in the boardroom or even a secret desire to be accepted by others. Hence successful directors and boards need to be deep observers of human behaviour and boardroom dynamics becausebehavioural and cultural nuances are significant aspects in most incidents of mismanagement leadingto governance failure.<br><br>Lucidly described with a plethora of real events and insightful instances Inside the Boardroomshowcases the authors’ experience with governance and boardroom behaviour. It brings to lightmisbehaviours in the boardroom early warning signs of failing governance in companies and somemagical mantras for CEOs and independent directors to prevent failures.