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Central PSUs & Board-level selections: Rules rehashed, PESB chairperson gets what she wanted

By Rakesh Ranjan- 07 Jan 2022
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New Delhi (07.01.202): A little over three months after PESB's first woman chairperson Mallika Srinivasan requested the Union Government to lift some load off her back, the DoPT, acceding to her plea, notified on 30.12.2021 changes to the Resolution dated March 03, 1987, on the functioning of the public sector head hunter.

Readers may recall that Indianmandarins was the first to report (26.09.2021) on Ms. Srinivasan’s request to the government to relieve her of too much of responsibility in the Public Enterprise Selection Board (PESB) because it was clashing with her other urgent responsibilities, not the least of which is running her own Fortune Rs 500 company TAFE Ltd whose turnover on March 31, 2021, was `500 crores. 

The latest changes to the PESB resolution are modified in such a way as to relieve her of routine burden and maximize her professional contributions only for tops posts of CMD, besides reinforcing her pivotal role in the PESB selection - no selection for any category of CPSEs will be deemed complete without Chairperson's consent.

According to the changed provisions, Chairperson's presence will be required only for the selection of a chairman, CMD, MD, and functional directors of Schedule A&B CPSEs.

Quorum has been modified to two members - PESB chairperson and any one member. However, for the selection of functional directors of Schedule B CPSEs, chairperson's presence will not be mandatory to complete the quorum. Further, for Schedule C&D CPSEs, the chairperson's presence will not be mandatory for the selection of a chairman, CMD, MD, and functional directors. It may be noticed that the modifications to quorum are made to suit Ms Srinivasan's convenience at each and every step.

The revised quorum subject to various possibilities, situations, and circumstances indicates that the new arrangement suits the incumbent Chairperson as well as others in the post-COVID scenario.

It states that if the circumstances demand the attendance to complete the quorum shall be valid in virtual participation by any or all members. In addition, it shall not exclude the Chairperson from at- tending any selection meeting over and above the quorum requirement as mentioned

above.

The new arrangement underlines that all recommendations arrived at in the selection meetings in respect of functional director in Schedule B CPSEs shall be subject to final approval by the Chairperson whereas in respect of Schedule C & D CPSEs the decision of the Chairperson shall be final in case no consensus is arrived at in the selection meeting(s).

And, finally, it categorically mentions that no recommendations of the Board (PESB) shall be invalid due to the absence of the Chairperson and/or any member of the Board in the selection meetings as the case may be for the period from July 01, 2021 till December 31, 2022.

Our report dated 26.09.2021 (CLICK FOR THE REPORT) had underlined that; “....she (PESB Chairperson) has reportedly made it clear in the official memo that at best, she might consider involving herself with the selection of CMDs and MDs, but definitely not of directors of various PSU boards. The latter is a time-consuming process...’

ALSO READ:

Is PESB chairperson unhappy, thinking of quitting? (26.09.2021)

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