Thursday, April 11, 2013

IIMs seek liberty to elect directors

The Indian Institutes of Management (IIMs) have a wish: The freedom to select directors on their own, and at an accelerated pace. The Ministry of Human Resource Development (MHRD)'s intervention in its matters, including selection of directors, is taking a toll on the schools' reputation, they claim. "We are losing our charm internationally," laments an IIM director. "We need basic freedom to at least appoint our own directors, sans anyone's permission. We do not see international professors interested in heading IIMs."

Consider this: Samir Barua, Director at IIM-Ahmedabad, was to remit office in November 2012 but was given an extension of a few months. Ditto with Shekhar Chaudhuri, Director, IIM-Calcutta, and Pankaj Chandra, Director, IIM-Bangalore, who is still on extension. In contrast, look at similar appointments internationally: Cornell University's management announced Soumitra Dutta as the new dean in January 2012, when he was to take over in July 2012. Nitin Nohria was announced Harvard Business School's dean in May 2010, when he was to take over in July 2010.

In fact, the board of governors at IIM-Ahmedabad (IIM-A) had sent names of three contenders - Ashish Nanda of Harvard University and IIM-A faculty members G Raghuram and Rakesh Basant - for the post of Director to MHRD on May 9, 2012. But the ministry is yet to respond. The board, in the absence of a clearance from MHRD, this month asked Dean (Faculty) Ajay Pandey to take over as the Acting Director. While IIM-Calcutta appointed a Director this week, IIM-Bangalore is yet to appoint one.

"I do not understand why an IIM needs the MHRD or the permission of the Prime Minister's Office (PMO) to appoint a director. Why can't decisions regarding educational institutions be left to them? We are institutions of the 21st century. Why do we have a board of governors if we can't be allowed to select our own directors?" asks an IIM director.

Sources at the premier management institutes say the process of selecting a director should be accelerated, as it would be a good model to have a director-designate six months to one year in advance. This would allow the outgoing and incoming directors to work together, allowing for better hand-holding before one takes over.

As an IIM director completes his term, a search committee is constituted to shortlist eligible candidates and recommend them to MHRD. The ministry approves the list, sends it to the Department of Personnel, which forwards it to the PMO for the Cabinet Committee's approval.

Globally, however, much before a director or dean's term comes to an end, headhunters identify some key names of eligible candidates and send these to the dean of a search committee, which comprises faculty members from the institute. Committees at the university and school levels come together to interview and shortlist candidates. The appointments are usually done months in advance.

A M Naik, chairperson of the board of governors of IIM-A, says though the selection of directors six months in advance would be a good move, the government's role in the process would remain, as it was an important stakeholder. Ashok Thakur, Joint Secretary at MHRD, could not be contacted for comments despite repeated attempts for two weeks.

Source: Business Standard, April 11, 2013

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