Source: The post is based on the article “Express View on IIM bill: Mis-management” published in The Indian Express on 9th August 2023.
Syllabus: GS 2 – Governance – Government Policies & Intervention
Relevance: concerns with the Indian Institute of Management (Amendment) Bill, 2023.
News: Recently, the Lok Sabha has passed the Indian Institute of Management (Amendment) Bill, 2023. The Bill increases the government influence over the appointment and removal of directors at Indian Institutes of Management (IIMs).
What are the concerns with the Bill?
The IIM Act, 2017, aimed to elevate these elite management schools to “institutions of national importance” and empower boards of governors to appoint directors of an IIM on the basis of the recommendations of a search-cum-selection committee.
However, the new legislation subordinates the boards to the IIMs’ Visitor (the President of India), granting the government substantial veto power in the appointments.
If the Bill is enacted, the Visitor will nominate the board’s chairperson, a responsibility previously held by its members. The government will also define the terms for the board’s suspension or dissolution.
The Visitor’s expanded authority compromises the institution’s autonomy. For instance, the President can institute inquiries and issue directives which will be binding on the IIM management.
Moreover, despite assurance given by the education minister that the government wouldn’t intervene in IIMs’ operations, the move raises concerns about government influence on IIMs.
What can be the way ahead?
There has been criticism regarding the operations of B-schools in the recent year. For example, IIM Calcutta experienced a conflict between its Board and Director, revealing concerns over executive powers and conduct.
This necessitates the importance of checks and balances for IIM functioning. However, excessive government involvement might yield negative consequences.