Some of India's biggest public sector companies are yet to appoint a woman independent director as the deadline to comply with markets regulator Sebi's directive is fast closing in.
PSU giants NTPC, SAIL, BHEL and Coal India, also known as Maharatnas, have failed to conform to the regulatory guideline of recruiting at least one woman independent director.
In May 2018, Sebi said the top 1,000 listed companies must have at least one woman independent director by March 2020. With the deadline fast approaching, PSUs are losing precious time to do a salvaging act to herald a long-awaited reform in the corporate sector.
Moneycontrol reached out to the above-mentioned PSUs but received a response only from NTPC.
"At NTPC, the position of woman independent director is vacant since November 16, 2019. As appointment of directors are made by the Government of India, the company has already written to the administrative ministry in this regard and appointment of woman independent director is likely to be made shortly," a NTPC spokesperson told Moneycontrol.
Other Maharatnas such as Oil and Natural Gas Corporation, Indian Oil Corporation Limited, Gas Authority of India Limited, Bharat Petroleum Corporation Limited and Power Grid Corporation of India have a woman independent director each on their boards but the gender representation is not different from other Indian boardrooms.
Among the 14 Navratnas, half – Bharat Electronics Limited, Hindustan Aeronautics Limited, NLC India Limited, EIL, HPCL, REC and National Mineral Development Corporation and Shipping Corporation of India – do not have a woman independent director.
Moneycontrol reached out to MCA Secretary Injeti Srinivas to ascertain the progress made on this front but there was no response.
Arundhati Bhattacharya, the first female head of State Bank of India, said more commitment is needed to ensure things change at the ground level. "There is no easy answer to this problem," she said.
SEBI ACTION?
What will Sebi do in case these PSUs miss the deadline?
Rajat Bhardwaj, a Delhi-based corporate lawyer, said SEBI can take action for non-compliance of its directives. He cited a circular dated January 22 2020 issued by Sebi that warned of a fine of Rs 5,000 a day in the case of violators among listed companies.
"The circular empowers the regulator to take more stringent action against the listed companies and PSUs. Suo motu actions can also be taken by the courts if the compliance is not done within time," he said.
The representation of women in PSU boards once mirrored those of private companies — dominated by men. But in recent years, the private sector has roped in more women in boardrooms, albeit after a nudge from the regulator.
MINDSET ISSUE
Although the representation of women in boardrooms has risen after the Companies Act of 2013 mandated listed companies of a certain size appoint at least one woman director, a comprehensive implementation of the guidelines is yet to happen.
Rituparna Chakraborty, co-founder of TeamLease Services, said regulatory nudge is not enough to bring about a change. "Unless there is acceptance and acknowledgement of the socio-economic benefit of having more women at workplace at all levels, the situation is not going to improve. It also needs a top-down messaging to embed it in the culture of an organisation," she said.
According to Chakraborty, management designs, keeping in mind the ever-evolving corporate ecosystem, are proving to be a major impediment in implementing any reforms. "Compared to the public sector, there is a relatively greater chance for women employees in the private sector to get recognition," she said.
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