Central public enterprises seek greater autonomy

Standing Conference of Public Enterprises (SCOPE) has urged the Centre for more autonomy to the 246 central public sector enterprises (PSE).

Greater autonomy would help the PSEs make quick decisions, both functional and strategic, in the backdrop of today’s dynamic business environment, SCOPE Director General U D Choubey said here today.

“The public sector enterprises are facing tough challenge from the private sector and in the current scenario, the central PSEs cannot even appoint a general manager level personnel on their own,” he lamented.

He said the lack of autonomy was hampering the progress of PSEs at a time when companies are expanding internationally.

“The ownership and management of these enterprises at the board level should be separated, since the company board works according to the agenda and there are several checks and balances already in place,” Choubey added.

SCOPE is an apex body of central PSEs and was created by a cabinet decision in 1973 to pursue the interests of these enterprises in matters of policy, employability and training. It is a part of International Labour Organisation (ILO).

The net worth and turnover of all the central PSEs in India is estimated at Rs 5,85,000 crore and Rs 1,27,000 crore respectively. Of the 246, 46 are listed PSEs.

“These 46 listed entities account for almost 25 per cent of the market capitalisation of 940 odd listed Indian companies,” he informed.

Meanwhile, SCOPE has expressed concern over the shortfall of 350 independent directors on the board of the PSEs.

“The posts of independent directors should be filled immediately. There is also the need for their training and evaluation of their performance just like functional directors,” Choubey said.

SCOPE has advised the PSEs to put a succession plan in place at least six months before the respective chairman or director is due to superannuate, as the process is time consuming and cumbersome. The PSEs have been asked to keep a pre-qualified list ready with them for such occasions.

Around 51 PSEs are sick units, of which 20 companies are on the verge of transformation after getting a package from the Centre. “The decision on the remaining units is being mulled as to whether their revival is economically feasible or they need to be disposed off,” he said.

Choubey was in town in connection with two workshops on the Right to Information (RTI) Act 2005 and ‘Prevention & Management of Chemical Accidents’.