The NDA government would soon be directing all ministries not to appoint independent directors, who were selected by the previous UPA regime, in the boards of central public sector enterprises (CPSEs). Cabinet Secretary is holding a meeting on this issue on Monday to approve the proposal, said sources.
The NDA’s earlier strategy was that past selections should not be ratified by shareholders in the annual general meetings so that the selected persons — currently functioning as additional directors in the board — would have to discontinue and the post would fall vacant for re-selection by the Appointments Committee of the Cabinet (ACC).
However, since this would be a time-consuming process with each CPSE holding their AGM over the next 2-3 months, a decision was taken at the highest level to guillotine the entire previous selections through a directive so that the ACC could quickly approve fresh names for appointment by September-end.
- Big Cheer For Delhi-Noida Commuters, DND Flyway Becomes Toll Free
- PM Modi Meets New Zealand Prime Minister John Key
- Ex-Arunachal CM Kalikho Pul Left Behind “Secret Notes” Before He Was Found Hanging: Rajkhowa
- Big Relief For Former Karnataka CM BS Yeddyurappa: Here’s Why
- Missing For Three Days, JNU Student Found Dead In Hostel Room
- Bigg Boss 10: Review Of October 25 Episode
- Delhi Government’s Rs 200 Crore Riverfront Plan: Find Out More
- School in Jammu & Kashmir’s Bandipore District Set on Fire
- Ajay Devgn On The Making Of Shivaay: Exclusive Interview
- Bodies Of Maoists Killed In Malkangiri Encounter, One Of The Biggest Such Operations
- Mumbai’s Haji Ali Dargah Trust to SC: Ready to give women access to sanctum sanctorum
- Samajwadi Party Crisis: 5 Quotes By Mulayam Singh Yadav At Press Conference
- Ae Dil Hai Mushkil Vs Shivaay: What Delhites Pick
- Supreme Court Directs Vijay Mallya To Fully Disclose Foreign Assets In 4 Weeks
New corporate governance norms that kick off from October 1 require at least one-third of the board should comprise independent directors where the Board chairman is a non-executive director and at least half of the board in case the company doesn’t have a regular non-executive chairman.
Non-compliance with the new provisions would delay the listing and disinvestment of government equity in some of the targeted CPSEs until the vacancies are filled. It could also result in some CPSEs getting downgraded from their present status of maharatna and navaratna, said sources.
They said the October 1 deadline was being used as a pretext for getting the Cabinet Secretary to issue the diktat to axe the past appointments and provide a route to the NDA government to fill up these vacancies with their nominees.
Independent directors are drawn from public men, technocrats, management experts, consultants and professional managers in industry and trade with a high degree of proven ability. New norms require that the criteria for their selection would have to be disclosed in the annual report.