Panel suggests cooling off period before IIM director’s third term

IIM Rohtak campus

A government panel set up to frame rules under the IIM Act is learnt to have prescribed “a cooling off period” of five years before an IIM director, who has served for two consecutive terms, becomes eligible to be appointed as the head of the same institute again. The panel, headed by IIM Sirmaur Chairman Ajay Shriram and with IIM-Bangalore director G Raguram and IIM Rohtak director Dheeraj Sharma as members, has also backed the longstanding demand of the premier business schools to extend the retirement age of an IIM director to 70 years.

The current retirement age of 65 years is unique to the 20 institutes even as heads of IITs and central universities are permitted to serve their term up to the age of 70. In 2015, IIM Bangalore’s Board had last written to the HRD Ministry requesting an exception for its then head Sunil Vachani by raising the retirement age to 70 years. The above recommendations will be part of the draft rules that will be vetted by the law ministry before being notified. Clause 34(1) of the IIM Act empowers the government to make rules to carry out the provisions of the law. The rules will lay down terms and conditions of service of the director and the powers and duties of the Board of Governors (BoG) among other things.

The eight-member committee’s recommendations include:

In case of sudden vacancy of a director’s post because of any reason, the institute will initiate the process for filling up the post within a month and wind up the process within six months.

An IIM director can be removed by the board only with 2/3rd majority of the board, excluding the director.

A director can resign from the post with three months’ notice. The board may not accept the resignation in case an inquiry against the director is going on or being contemplated by BoG.

The first Coordination Forum – the IIM equivalent of the IIT Council- will be constituted by the government.

Every year all 20 IIMs will have to enter into a memorandum of understanding with the government spelling out performance parameters and output targets.