Much has been said about the importance of having independent directors. Trouble is all the studies are inconclusive. Now a new study suggests suggests independent directors are not as effective. Not sure if the methodology stacks up but it adds to the debate, even if it doesn't provide the answers.
Trouble is director independence, board size, splitting the role chief executive officer and chairman, age of directors and tenure has less impact on corporate governance than what many think. As this piece suggests, independence is a state of mind. A director can be formally independent and not psychologically independent within the boardroom. Canadian academic Richard Leblanc says competence is more important than independence. You can listen to him make his case here.
The issue of independence of non executive director requires to be seen in the context of his competency and the role he is assigned.There are insstitutions that groom their professional under ethical codes and train them as to how to remain independent and use safegaurds where necessary to meeet that end.So it is this grooming that psycologically makes him independent. In Islam muslims are required not to favor their near and dear ones when it comes to choice between right or wrong,just and unjust and on all matters that demand impartiality,yet many a muslim violates the code and will be answerable for this here and hereafter.So it will again be one’s own choice and track record that should serve as a criteria rather than qualification and apparent independence.