Ready to join a Risk Management Committee, and to chair one in time
My contribution to a board
I would bring a board the habits of someone who has spent twenty years deciding where to build, what to buy and what to walk away from. Most boards are well equipped to test a capital budget and less equipped to test the assumptions underneath it: whether the people a plan depends on will actually come, whether an acquired business's customers will stay, and whether a new region's economics resemble the old one's. Those are the questions I have learnt to ask first, and I would ask them of any company expanding a network of sites, not only of hospitals.
I would also bring the discipline of post-investment review. Since 2021 every Kesarvan project above ₹100 crore has returned to our board with its original case set against its results, beginning with a hospital I had supported that missed its hurdle badly. A director who has presented her own misses tends to ask management for theirs, and I would expect to.
For the larger listed companies to which the requirement applies, the SEBI Listing Regulations require a Risk Management Committee chaired by a board member, with board members in the majority and at least one independent director. That is the committee where I believe I would be most useful. I would want to join it as a member, learn the company's risk register and its management's habits, and chair it only after a year, if the board wished. I would also serve on an Audit Committee as a financially literate member, but I am not an accountant and would not offer myself as its financial expert.
Finally, I would bring a willingness to disagree on the record with a founder or promoter. At Kesarvan I recommended walking away from an acquisition our executive chairman wanted and keeping a business our CFO wanted to sell. In both cases the relationship survived because the disagreement was made in a paper with its evidence, and the alternative was set out fairly beside it.
Judgement in practice
01
A post-investment review that began with my own miss
When I introduced post-investment reviews in 2021, the managing director suggested we begin with a recent success. I proposed our Bilaspur hospital instead, which opened in 2019 with a multi-speciality plan I had supported, and which was returning 6 per cent against a 15 per cent hurdle. The paper set out the original case, what had happened and why: we had planned beds and equipment in detail and specialists in outline, and seven of 24 specialities were still unfilled fourteen months after opening. I presented my own part in it first. The board asked for the same review of every project above ₹100 crore at two and four years, and the lesson reshaped our next three hospitals. On another board I would ask for this kind of review early, and I would expect management to bring its disappointments without being asked.
02
A site offered by a member of the founder's family
In 2021 a company owned by a relative of our executive chairman offered us land for the Yavatmal hospital at a price 22 per cent above the valuation my team had commissioned. A related-party transaction of that kind needs the Audit Committee's approval, and the analysis behind the paper was ours. I set out the related party's offer, our independent valuation and two alternative sites, one of them better located for the highway on which most of our ambulances would travel. I recommended the alternative. The committee agreed, and the relationship with the family remained cordial because the paper made no judgement about motives, only about price and suitability. As a director I would want every related-party proposal to arrive with an independent benchmark and at least one real alternative, so that the committee is choosing rather than merely approving.
03
A laboratory error disclosed in full
In 2024 a routine quality check at our Raipur reference laboratory found that a faulty reagent lot had produced unreliable results for one blood test over eleven days, affecting about 2,300 reports. As a director of the diagnostics subsidiary, I supported the laboratory director's proposal to contact every affected patient and referring doctor, retest free of charge and commission an external review of our quality-control procedures, at a cost of about ₹1.1 crore. Some colleagues preferred to contact only patients whose results had led to a change in treatment. We chose full disclosure because doctors who refer to us need to trust every report, not only the ones we judge important. The external review led to a second, independent check on new reagent lots. On a board I would ask how quickly a company tells its customers about its own errors, and who decides.
My first year on a board
I would spend my first three months listening and reading. I would read three years of board and committee minutes, the company's risk register and how it has changed, its last few post-investment or post-acquisition reviews if it has any, and the related-party register with the approvals behind it. I would visit at least two of the company's sites, including one of its newest and one in a smaller city, because the risks in a network usually show first at its edges. I would ask to meet the chief risk officer, the heads of internal audit and the statutory auditors, and the executives who lead expansion.
For the rest of the year I would serve as a member of the Risk Management Committee and not seek its chair. I would want to understand which risks the company measures, which it only describes, and which it has not yet named. At the end of the year I would ask the board chair and the committee chair for direct feedback, and use the board's own evaluation to test whether my questions had helped or merely added to the agenda.
Conflicts and their management
My first obligation is to Kesarvan, where I am a full-time executive. I would not join the board of any hospital, diagnostics or healthcare-services company, any health insurer or third-party administrator, any pharmaceutical, medical-device or consumables supplier to hospitals, or any company with a material relationship with Kesarvan or its founder's family. Before accepting a seat I would disclose my Kesarvan shareholding and my subsidiary directorship, and seek the consent of Kesarvan's board.
If a conflict arose after appointment, for example because the company began to supply or contract with Kesarvan, I would disclose it at once, recuse myself from the relevant discussions and offer to step down if the relationship was likely to recur. Time is the other conflict. Kesarvan's board calendar and its expansion projects will sometimes collide with another company's meetings, so I would agree dates a year ahead and keep twenty-eight days genuinely free, including preparation, rather than promise more than I can give.
My independence statement
My employer is Kesarvan, and I own a small number of its shares through employee stock options. A company considering me should know that, and should know of any dealings between itself and Kesarvan, our founder's family or me, which I would set out in writing before a first meeting. Where such a relationship is material I would decline. Applying the test in section 149(6) of the Companies Act belongs to the appointing board, using what I have put in front of it; I would not presume to answer it on their behalf.
Board and committee exposure
Presented to the Board or a committee
Kesarvan Healthcare Limited
Board of directors: annual strategy review, capital allocation, acquisitions and partnerships
April 2021–present
Presents the strategy and every acquisition, partnership and new-hospital case at board meetings; not a director of the company and holds no vote.