Boards of top state-run firms' wait to be filled

Around two dozen executives on the boards of public sector companies are working on extension without formal letters from the government, raising issues of corporate governance since many of these are top listed companies.

Besides, a host of public sector companies are awaiting appointment letters for full-time directors. These appointments were cleared by the United Progressive Alliance but the National Democratic Alliance government is not okaying these.

Power and petroleum companies were acutely affected because their administrative ministries, headed by Piyush Goyal and Dharmendra Pradhan, respectively, were silent on the issue, said a senior executive in one of the companies.

The position of director (finance) in Power Finance Corporation is a case in point. R Nagarajan's tenure expired earlier this month. He is, however, continuing to officiate. "His extension was approved by the previous government, but neither the current administrative ministry nor the Prime Minister's Office has come out with a decision," said a company executive who did not wish to be named. Approached for his comment, Nagarajan said, "I cannot talk on the issue."

Prime Minister Narendra Modi heads the Cabinet Committee on Appointments, which gives final approval to top appointments in the government and public-sector companies. After this clearance, the department of personnel issues a formal letter. In such situations, who will take the onus if a decision during this period goes wrong, said the executive.

Indian Oil Corporation will see its finance director retire this month. "Normally the replacement is announced well before the incumbent's retirement, but although A K Sharma's name was cleared by the UPA government, his appointment has not been finalised," said another source who did not wish to be named.

Indian Oil's finance director handles subsidy, pricing and procurement of crude oil from markets abroad. The chairman's position in the company also was under additional charge for about two months. B Ashok took charge on July 16 under the National Democratic Alliance government. For Oil and Natural Gas Corporation, its overseas arm ONGC Videsh has its finance director officiating as managing director since March. NK Verma, exploration director in the parent company, was chosen by the Public Sector Enterprises Board for the post during the UPA tenure but he too is awaiting a letter from the new regime.

"In the last leg of the UPA government, Manmohan Singh, the then prime minister, did not sign on any new PSU appointments because a model code of conduct was in place. Even before that Singh was reluctant to take a decision because the government was approaching the end of its tenure," said the executive quoted above.