Shyamal Majumdar: Empowering the IIMs

The government has reined in its urge to control; it's up to the boards now to prove their worth

Prime Minister Narendra Modi has indeed walked the talk on his pet theme “minimum government, maximum governance” in at least one area of critical importance — the Indian Institutes of Management (IIM). One of the most significant proposals in the new IIM Bill that awaits Parliament’s approval is that the boards will have the final say in the appointment of directors. This is a huge improvement over the draft Bill, which said where the visitor (the President) “is not satisfied with the recommendations of the search-cum-selection committee, he may ask the… committee to make fresh recommendations”.
 
To gauge the importance of this decision, consider this: Many of the older IIMs — most of the new ones have not been able to appoint anybody anyway — go headless or have to request the incumbent directors to stay on for some time as the shortlisted candidates are often made to wait for the ministry’s approval for an inordinately long time. Many of these candidates lose patience with the system and opt out, making the entire appointment process a mockery.

 
One such candidate says he was willing to take up the job because of the prestige attached to the post, but wrote to the IIM about his inability to remain available as he didn’t hear anything from the ministry for over five months. The IIM concerned remained headless as the search process had to start afresh. “There is no reason why the IIM boards comprising eminent people can’t take that decision on their own,” he says. In fact, Smriti Irani, the earlier human resource development (HRD) minister, had rejected the recommendations of an expert panel, which had suggested the names of some corporate stalwarts for the chairmanship of IIM-Ahmedabad, without giving any reason for the rejection.

 

 In contrast, the boards of international management institutes take such decisions independently, with the result that their deans are often appointed six months in advance so that there is a hand-holding period.
 
The distance that has been covered is also evident from the fact that the earlier draft Bill had reduced IIM boards to rubber-stamping handmaidens of the ministry, ignoring the fact that the larger IIMs are financially self-sufficient and committed to raising their own funds.
 
On a chairperson’s appointment, the draft Bill had said (s)he would be appointed by the central government “in such manner as may be prescribed”, leaving this critical appointment wide open to government interference. The Bill had said there would be a “coordination forum”, which would “perform such other functions as may be referred to it by the central government”. The giveaway was the Bill’s wording that this forum would be chaired by the minister and have as members the minister of state in the central government, four ministers of state governments, the Union secretary for the ministry, chairpersons and directors, and three people of eminence, of whom one shall be a woman academic and the first nomination would not need institutes to suggest names.

 
The earlier Bill, which became a huge bone of contention between the IIMs and the government, had given the latter a say in almost all crucial decisions. From the appointment of the board and its chairman to deciding the fee structure to the creation of new academic departments, a government nod was required.
 
The new Bill has, hopefully, sorted out these issues and has also made sure that each IIM is free to set its own curriculum and teaching standards. The expansion in the aggregate student intake should also be determined by each institute itself — not the government.

 
The Prime Minister’s Office apart, HRD Minister Prakash Javadekar deserves credit for making all the right moves so far. That in itself is an achievement considering his predecessor’s penchant for bouncing from one controversy to another during her 13-month stint, as a result of which education in India was often in the limelight for the wrong reasons. It’s not often that a minister agrees to relinquish the government’s role in a high-profile area under his control, but Javadekar has done precisely that: As per provisions of the Bill, the HRD minister will relinquish his role from the IIM Council, which is involved in administration and overall strategy.

 
It’s up to the IIM board members now to prove their worth.