Patel will be returning to the Britannia board following a two-year absence.
Britannia Industries has disclosed to the stock exchanges that Urjit Patel, a former governor of the Reserve Bank of India (RBI), will be joining the board as an independent director.
Urjit Patel and Sunil Siddharth Lalbhai were proposed by the Britannia board to serve as extra non-executive independent directors for a period of five years, provided that the shareholders approved the recommendation. Patel will be returning to the Britannia board following a two-year absence. He left in 2022 after accepting a position as CEO of the Asia Investment and Infrastructure Bank on a full-time basis. After assuming leadership on September 5, 2016, he left his position as RBI governor in December 2018.
Patel, the 24th governor of the RBI from 2016 to 2018, is not the first leader of the banking regulatory body to join a private sector board. Notably, the late S. Venkitaramanan, who served as the governor of the RBI from 1990 to 1992, held director positions on the boards of Piramal Healthcare and Reliance Industries, among other companies. In addition, he presided over Ashok Leyland Finance.
In contrast to numerous past central bank governors in India, Patel was the only governor to hold positions in the private sector before taking over at the central bank, having worked for IDFC and Reliance Industries. However, having experience in the private sector prior to leading a nation’s central bank is not unusual in the West, especially in the United States and Great Britain.
A large number of former deputy governors were appointed as consultants or occupied the role of independent director on boards. For instance, the chairs of HDFC Bank, the largest private sector bank in India in terms of market capitalization, are former deputy governors of the RBI, Jagdeesh Capoor, and, more recently, Shamala Gopinath.
Following liberalization, nearly every governor of the Reserve Bank, from RN Malhotra to Urjit Patel, assumed new roles after retiring from their positions as governors and adhering to a one-year cooling-off period. However, the majority of them have either taken on academic assignments or worked as public policy advisors.
While it is generally accepted that senior RBI officials must wait a year before accepting jobs in the private sector, the central bank granted exceptions a few years ago in some extraordinary circumstances, such as when an official must obtain their employer’s consent.
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