PSUs must give agenda in advance

COIMBATORE: In an apparent bid to check “last minute” hidden agendas from being tabled at Board meetings of State-run Public Sector Undertakings (PSUs) and Boards, the Tamil Nadu Finance Ministry has directed them to circulate the agenda copy at least a week in advance. At present, some of the PSUs and Boards distribute the agenda copy to members just before the commencement of the Board Meeting. This leaves members including the Director representing the Finance Department with little time to concentrate or to contribute meaningfully to the discussion on the agenda items. In a communication to heads of all PSUs and Boards, S Krishnan, Secretary to Government (Expenditure) has pointed out that officials of the Finance Department who act as part-time Directors on Boards of the PSUs should have “adequate time and resources to contribute” at the meetings to ensure better performance. Sources told Express that usually the agenda copy is circulated at the eleventh hour “so that the members would simply approve it and not object to controversial proposals.” The Finance Ministry has said: “As a matter of good corporate governance, the agenda and agenda notes are normally expected to be circulated to all the Directors well in advance (i.e. at least seven days in advance) of each meeting of the Board of Directors so as to facilitate meaningful discussion at the meeting.” In the letter, Krishnan also pointed out that the Institute of Company Secretaries of India, too has suggested such a procedure of advance intimation. Therefore, the PSUs and Boards must send the agenda notes to the Directors concerned either through e-mail or in the form of a CD a week in advance. According to Krishnan, if the agenda is circulated in advance, the Directors on the respective Boards could make a better business decision. Also they can “think of alternatives to a proposed business decision” for which they could seek additional information.  The Directors per se act in good faith and need to exercise care so that they can take informed decisions. Krishnan added that in October 2006, the State Government had insisted on a three day notice for circulating agendas but even that was being violated in some cases.