The Hindu Business Line : <I>Stirrings of a despised behemoth</I>

Two phrases that can often elicit quick yawns are `corporate governance' and `public sector'. Yet, Corporate Governance in Public Sector Enterprises, edited by S. M. Dewan, from Pearson (www.pearson-books.com) isn't a book you can ignore.

Not because it is about a behemoth, regularly despised, but because "the greatest challenge of the public sector is to combine the jungle rules of competition and the social obligations of a just and equitable society," as Sarthak Behuria, Chairman, Scope, writes in his Foreword.

The book is `mainly an insiders' view', confesses the intro, referring to "the ones who headed the Central Vigilance Commission or have been consultants in the makeover of public sector units in the days of liberalisation and CMDs of public sector enterprises."

If that sounds too `inside' to be interesting, a far serious jolt awaits you in chapter one, where Dewan writes that in terms of gross and operating profits, "the government as a whole has done far better than either the domestic or the foreign private sector."

The performance of top 50 business houses and the smaller ones has been `dismal in comparison', he says, after analysing data on CARG (cumulative average rate of growth) for the period 1998-2004.

"The central public sector as a whole is a better performer than even the foreign multinationals and the cream of the private sector, namely, its business houses," concludes Dewan. "If there is a poor performer in the government sector then it is the takeover units — the sick companies with the private sector that the government took over to protect the stakeholders, creditors and the employees." On that there can be heated arguments.

Y. R. K. Reddy's chapter on `Issues in public sector governance' notes, "Principles of corporate governance evolved by the OECD (Organisation for Economic Cooperation and Development) and now accepted as global standard, do not explicitly acknowledge the issues of government ownership."

As if to help, `Public Governance and Management' is a whole section on www.oecd.org. "Work on public governance includes activities on e-government, regulatory reform, public sector budgeting and management, citizen participation in policymaking, and fighting corruption," informs the site.

Ashish K. Bhattacharya writes on the role of government, M. M. Luther on autonomy, C. V. Baxi on independent directors, S. P. Wahi on management issues, N. Vittal and K. M. Mittal on ethics. Ajit Prasad and Charusita Chaudhary list seven habits of `effective boards'. There are chapters on public sector governance in Australia, Belgium and Switzerland.

Stirrings of interest

BooksOfAccount@TheHindu.co.in

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