If Sebi?s continued reposal of faith in the abilities of independent directors to keep companies straight despite such spectacular failures like Satyam wasn?t bad enough, the government continues to believe inducting celebrity corporate czars or consultants on the boards of PSUs can help turn them around. The latest, it appears, is the civil aviation ministry clearing the names of former Procter & Gamble India chief Gurcharan Das as an independent director on Air India?s board. Das joins other luminaries like Harsh Vardhan Neotia, chairman, Ambuja Realty Development. If Air India was to get revived so easily, the presence of Mahindra & Mahindra chairman Anand Mahindra and HDFC chairman Deepak Parekh?both independent directors in the past?on Air India?s board would have done the trick a long time ago.
Air India?s biggest problem has been the complete lack of market discipline. By virtue of being a government entity, it had access to the best slots in airports and an unlimited purse. So, despite the fact that its unions still haven?t come to terms with their new status?Air India and Indian Airlines pilot were in court on who would get to fly the new Boeings?the management wasn?t able to sack them. While the government did well to take a firm stance during the last strike, there is little guarantee the management will be given a free hand. The last time a professional management team was sought to be brought in, the ministry had no compunctions about removing them. It?s about time corporate chieftains came alive to the fact that they?re being hired for their star value and little else.
