Tuesday, October 23, 2018

Autonomy on the way as IIM rules finalised

Monday, August 13, 2018, 1:14
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NEW DELHI: The long-awaited IIM (Indian Institute of Management) rules for implementing the IIM Act, 2017, have finally got the go-ahead and are likely to be notified this month, unambiguously affirming the autonomy of the premier business schools.This follows months of debate and discussion — first between the old and new IIMs and later between the Prime Minister’s Office (PMO) and the human resource development (HRD) ministry.The IIM rules will follow the complete autonomy template pitched by the PMO with the government staying away from key roles on selection and removal of the chairperson and director, fee regulation, student intake, institute expansion and any other overriding powers that the HRD ministry has mostly retained over other institutes.The rules will, however, also now require each of the IIMs to select its board of governors through a nomination committee to ensure that members are selected “objectively,” according to documents ET has seen. Here’s a snapshot of the rules:LEAN LEADERSHIPThe HRD ministry has found way to bring ‘balance’ to the allpowerful IIM board of governors (BoG). The rules prescribe the setting up of a BoG nomination committee by each IIM to select its members. The committee will consist of the chairperson, one eminent person and one alumnus who will work in line with regulations set by the BoG with a two-thirds quorum.65380644

The IIM Act mandates a lean BoG at 15 members with specific categorisation prescribed. Those that exceed this number will have to shed members. IIM Ahmedabad, Kashipur and Vishakhapatnam are among those which may have to do so. Members can, however, continue until vacancies in categories are not filled, the rules say.All-Powerful BoGThere were considerable reservations on the part of the HRD ministry and some IIMs over the possibility of a self-perpetuating BoG going rogue, or even ousting a director or chairperson over differences of opinion.They recommended “safeguards” such as ensuring that a decision by “consensus” of the BoG rather than “majority” be made mandatory for the removal of a chairperson or director.The idea was rejected as a possible backdoor entry for governmental control by the PMO and the final IIM rules read that a removal can only be made “with consent of at least two-third of the members present and voting and more than 50% of the members of the board in a special session to be convened by giving at least 15 days notice.”DUTIES AND POWERSWhile previous drafts asked IIMs to sign a memorandum of understanding (MoU) with the HRD ministry spelling out “performance parameters, output targets, roadmap for improved performance with clear milestones” and added that the ministry may “prescribe criteria such as expansion of the institute, increase in student intake, etc.,” these have been omitted in the final rules.Previous drafts wanted IIMs to “ensure” that the charged fee is commensurate “with the overall expenditure for maintenance and expansion of the institute” but the final rules say that while the BoG is “empowered to fix the fees, all institutes shall endeavour to ensure that no deserving student is denied education in the institute for want of funds.”Letting off IIMs from signing the MoU as the General Financial Rules 2017 require of every institute, they have to “maintain canons of financial propriety” as reflected in the GFR.The IIM rules ask institutes to follow “guidelines issued by the CVC (Central Vigilance Commission) or the government from time to time and maintain transparency in the working of the institute” and includes a line to say that in the case of any doubt over rules, the BoG may seek clarification from the HRD ministry and this “clarification so provided shall be final.”

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