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Journalism of Courage
Subir Raha, chairman of the Oil and Natural Gas Corporation, has protested against the petroleum ministry8217;s decision to appoint two additional nominees of the government to the firm8217;s board. He must be commended on this bold step. The government has been treating, and continues to treat, public sector enterprises as its fiefdom. The interests of the government and the popularity of the ruling party are sought to be served through a gross violation of corporate norms.
The issue was the appointment of the director general of the directorate general of hydrocarbons DGH, as a member of the ONGC board. One of the jobs of the DGH is regulation of oil production and exploration business on behalf of the government. The DGH chairs all management committees of joint ventures in which ONGC is a partner. Thus all proposals by ONGC are judged by the DGH on behalf of the petroleum ministry. Appointing the DGH additional secretary to the board would have further strengthened the ministry8217;s hands in the decisions made by the ONGC. Good corporate governance requires that ONGC be accountable to all its shareholders, and not merely the government. The government is the majority shareholder but 26 per cent of shares are held by the public. The government cannot behave as if it owns the company. On an earlier occasion, it has chosen to make ONGC pay for losses of other PSU companies in the name of 8216;subsidy-sharing8217;. Such behaviour will undermine the navratnas, not strengthen them.
