Board of Directors: An Empirical Study of Navratna Companies

Abstract

Evaluation of Navratna BODs operations are at times confidential and very complex, studying, analyzing and
evaluating them becomes a very difficult task. The perform efficiently a BOD needs knowledge, time, information,
motivation and power. Public Enterprises Section Board (PESB) has to play a strong role and endure that concerned
Ministry is not allowed to get away with any arbitrary decision and whatever it decides should be done on time to
ensure a smooth transition in the company with a proper handing over and taking over. The concept of orientation
of non-executive official and non-official directors has not received much focus till now, not only in India but all
over the world. As against management Corporate Governance involves dual responsibility fulfilling internal
organizational and societal needs. All the PSE representatives confirmed that they have formulated the corporate
vision, mission and objectives in compliance with the above referred circular. It is very important for the BODs to
ensure that the team of senior mangers has the desired combinations of qualities required at that level to shoulder
the responsibilities placed on them. The BODs role consists of two levels one relates to setting mission objectives
and policy formulation and the second level functions include monitoring management, and reviewing and
controlling their activities form time to time. In our survey, we found that the BODs must not involve itself in day to
day functioning of the organization and also that governance does not involve ensuring returns in the short run. This
research based on nine NAVRATNA companies (like ONGC, NTPC, SAIL IOC, HPCL, BPCL, GAIL, MTNL, BHEL)
Keywords: Corporate Governance, Public Enterprises Section Board, Officer Director, Non-Executive Director,
Corporate Vision & Mission, Monitoring & Controlling Management.