Govt interference hindering PSUs' performance: SCOPE

The Standing Conference on Public Enterprises (SCOPE), the apex body of public enterprises, today said the government's interference in PSUs is hindering their performance.

"The issue of autonomy is important for the optimal performance of the PSUs and there should be no government interference in the day-to-day affairs of the enterprises," SCOPE Director General U D Choubey said told reporters here.

He said although the PSUs were owned by the government, there should be a clear demarcation between ownership and management.

Choubey said the ownership should not transgress into board level management of the PSUs.

Referring to succession planning in PSUs, Choubey said a number of PSUs such as ONGC were lying headless for a long period of time. This was affecting the performance of the concerned PSUs.

In this context, he said that SCOPE had suggested that vigilance clearance should be done online and selection of the chiefs should be completed three months before the superannuation of the incumbent person.

Choubey said the role of independent directors should also be judged and recalled when their performances were not up to the mark.

He said 300 posts of independent directors were lying vacant and would be filled immediately.

On the issue of corporate social responsibility (CSR), he said it was mandatory for PSUs to spend 2% of their net profits on CSR activity.

He said this provision should be made mandatory for the private sector as well and added that the new Companies Bill should incorporate this aspect.

The SCOPE Director General said the body had approached the Department of Public Enterprises on the issue of selection of PSU chiefs and that both the concerned minister and the secretary had given a positive view.

Meanwhile, the city chapter of the SCOPE was opened today to look into the issues of the PSUs located in the eastern region.