IOC likely to see board-level tweaks

NEW DELHI: The board of IndianOil appears set for some rejig, the second flagship public sector company after ONGC to witness structural changes at the top, to align the management functioning with new initiatives in a changing energy landscape.
People in the know said the changes are likely to begin with chairman Shrikant Madhav Vaidya being given the additional hat of managing director to wear, giving India’s largest oil refiner and fuel retailer its first MD since it was formally incorporated in 1964.
The oil ministry has approved the re-designation of the chairman’s post and awaiting clearance from the corporate affairs ministry’s nod, the people sited above said.
The second change on anvil is the abolition of the post of director (R&D) after incumbent S S V Ramakumar superannuates on July 31. The directorate is likely to be turned into a new initiative division reporting directly to the chairman.
IndianOil perhaps is the only major state-run entity that has been without an MD or a chief executive officer. The chairman has been carrying out the MD’s function without the designation.
Heads of all other government companies carry the designation of chairman and managing director (CMD). However, exploration major ONGC recently saw a reversal when Arun Kumar Singh was appointed as the head but designated only as chairman and leaving scope for appointment of an MD or CEO.
Under corporate norms, chairman is the top gun and supposed to manages the board of directors and set policy directions for a company. The MD or CEO is responsible for the day-to-day functioning and carry out the board’s directives.
The re-designation of IndianOil chairman’s post has become a necessity for a smooth interface with private sector and foreign companies as the company seeks collaboration for entering new-age energy and mobility areas. “Internally perhaps it does not matter. He has been given the powers. But it is important for dealing with outsiders,” one person among those cited above said.
The government last month had created the post of director (production) by merging the posts of directors onshore and offshore. Another post of director (corporate affairs) was created. The changes will be effective from March 1.

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