Public Sector Undertakings (PSUs) should have long-term objectives as they have larger responsibility compared to their peers in private sector to work towards achieving India’s economic goals, T K A Nair Adviser to Prime Minister Manmohan Singh said on Friday.
“I still believe you (Cental Public Sector Enterprises) have a larger role and responsibility to work towards achieving the political and economic objectives of the country which justifies your creation,” he said at a function organised by the Institute of Public Enterprises.
State-owned units have a larger role compared to a corporates in private sector. Therefore, PSUs should pay greater attention to long-term matters, he added.
“I think PSUs would be better placed to do long-term thinking and that could be triggered by independent directors based on their own knowledge,” Mr. Nair said.
On financial performance of PSUs, he said, “while assessing the performance of a PSU based on its balance sheet, we also have to be cautious of the restrains it faces compared to a private peer”.
“PSUs work under severe limitations and constraints that have to be kept in mind while you take an overall view on performance of CPSEs,” Mr. Nair said.
Speaking on the occasion, Joint Secretary in Department of Public Enterprises Ashok Pavadia, spoke on ethics and integrity in the boards.
“It is for board of directors to ensure that awareness is being created among employees in this regard,” he said.
Besides, he said, there should be some kind of system to reward employees or executives of CPSEs doing good work by following ethical practices.