Millennium Post

PSU brass need fixed tenure, more autonomy: Vasudeva

Oil and Natural Gas Corp (ONGC) chairman and managing director Sudhir Vasudeva on Friday pitched for fixed tenure for top management of PSUs and greater autonomy to their boards to make them competitive.

Speaking at AIMA's 3rd PSU Summit, he said a high level government committee had recommended fixed tenure of meaningful duration for the top management of state-owned firms to given them time to help them realise their vision for the companies.

'This (fixed tenure) will facilitate a long-term approach and ensure a strategic bent to the company's decisions,' he said. Vasudeva, 59, whose appointment as head of India's most profitable company was delayed by eight months due to false complaints, may not be able to take all initiatives to their logical conclusion in his less than two-and-half-year tenure that ends in February next year. Seeking greater financial autonomy, he advocated creation of a 'Super-Maharatna' category of PSUs by empowering them to compete in the international space efficiently. To develop and retain human resource talent pool, PSU board 'should be given freedom to decide their pays and perks within some broad guidelines,' he said.

Speedy lateral recruitment against identified gaps and reorganisation of the compensation structure are important. Also, boards need greater empowerment for selection of consultants, vendors with proprietary technologies, technology partners, joint venture partners and companies for acquisition.

Vasudeva said the government should make timely appointments of heads of PSUs as well as board positions 'so that there is no break in the decision making structure of the organisation.'

'There is every reason to believe that, unshackled from these constraints, the public sector companies, some of which are already global players competing with the very best in their field of operations, will attain even greater levels of performance and global acclaim,' he said.

He said PSU's' share of GDP was just 10 per cent in the beginning of the 70s, which grew rapidly in the following two decades and more than doubled to 25 per cent by 1990-91. 'However, the share remained relatively steady during the 90s and came down gradually in the recent years thanks to privatisation and disinvestments policy,' he said, adding that Central PSU share in GDP was 22.1 per cent in FY'12. Their contribution to the central exchequer by way of payment of excise duties and corporate taxes grew by 2.6 per cent from Rs 1,567.5 billion (Rs 1,56,750 crore) in FY'11 to Rs 1,608 billion in FY12. 'To my opinion, the issue of ensuring a level playing field in terms of freedom of doing business with our counterparts in private sector alone has the potential of unleashing tremendous capabilities of PSEs which in turn would surely usher in a new era of growth for the country,' he added.
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