The Central Board of Directors is at the top of the Reserve Bank’s organisational structure. Important decisions of the RBI are taken by the Central Board as it is the apex authority of the RBI.
Appointed by the Government under the provisions of the Reserve Bank of India Act, 1934, the Central Board has the primary authority and responsibility for the oversight of the Reserve Bank. It delegates specific functions to the Local Boards and various committees. The Governor is the Reserve Bank’s chief executive.
The Governor supervises and directs the affairs and business of the RBI. The management team also includes Deputy Governors and Executive Directors. Section 8 (4) of the RBI Act explains the term of the Governor and Deputy Governors. “The Governor and a Deputy Governor shall hold office for such term not exceeding five years as the [Central Government] may fix when appointing them, and shall be eligible for re-appointment.” (Section 8. 4. Composition of the Central Board, and term of office of Directors., P 17, RBI Act, 1934)
The Central Government nominates fourteen Directors on the Central Board, including one Director each from the four Local Boards. The other ten Directors represent different sectors of the economy, such as, agriculture, industry, trade, and professions. All the fourteen directors have a period of four years.
