Coming straight to the nub of the matter, let me begin by first and foremost pointing out that the Union Cabinet on January 24, 2017 approved the Indian Institute of Management (IIM) Bill, 2017, which aims at permitting the IIMs to grant degrees rather than diplomas and be declared as “Institutions of National Importance”. It is most heartening to note that the Union Cabinet chaired by Prime Minister Narendra Modi has finally given nod to the IIM Bill, 2017 which is a great milestone. Now IIMs would be able to grant degrees to their students rather than mere diplomas and also they would be themselves declared as “Institutions of National Importance”.

While craving for the exclusive indulgence of my esteemed readers, let me inform them that with the Cabinet giving its nod to the IIM Bill, 2017, it is likely to be presented before the Parliament in the upcoming budget session. Presently, we see that being societies, the prestigious IIMs are presently not authorised to award degrees and have been awarding Post Graduate Diploma and Fellow Programme in Management. But once the Bill is passed these prestigious IIMs would be declared as “Institutions of National Importance” and would be empowered to confer degrees to their students once they pass their course. It is a no-brainer that the IIM are the country’s premier league institutions which play a stellar role in imparting the highest quality education in management on globally benchmarked processes. Currently, there are 20 IIMs with each having separate autonomous bodies registered under the Societies Act.

For my esteemed readers exclusive benefit, let me also inform them that presently while these awards are treated as equivalent to MBAs and PhD, respectively, the equivalence is not universally accepted, especially for the Fellow Programme. But now things will change for the better once this IIM Bill, 2017 is passed. It must therefore be passed at the earliest.

To put things in perspective, the IIM Bill, 2017, provides for complete autonomy to the institutions, combined with adequate accountability. The Bill proposes a structure where the management of these institutions would be Board driven, with the Chairperson and Director of an Institution selected by the Board. The statement issued by the Union Cabinet also said that a greater participation of experts and alumni in the Board among other important features of the Bill.

As it turned out, shortly after the Union Cabinet decision was announced, Union Human and Resource Development (HRD) Minister – Prakash Javadekar tweeted that it was a “historic decision to give IIMs real autonomy and grant degrees”. Prime Minister Narendra Modi also tweeted: “The IIM Bill, which was approved by the Cabinet has been prepared with the aim of furthering excellence in these premier institutions.” Needless to say, it is a great milestone which will enhance the credibility of Indian IIMs much more all over the world and arm students with more lucrative jobs from all across the globe.

Needless to say, among the major provisions of the draft IIM Bill, 2017, is one which  grants power to the IIM Board of Governors to get an inquiry conducted against a Director in case it is felt that an institute has not performed as per the provisions of the proposed Act. The investigation will be conducted by a person not below the rank of a High Court Judge. This is really a laudable step in the right direction.

Let me bring out here that based on this inquiry, the Board may even remove the Director of the Institute or order any other action which it feels it is appropriate. But this shall not be done arbitrarily and in a whimsical manner. The Director, however, may be removed only after the Board has given him an opportunity to be heard.

Let me also bring out here that the proposed draft said the board must evaluate the performance of a new institute within the first three years of its establishment, and every few years after that. The institutes will be managed by a board, and each will have a Chairperson and Director who will be selected by the Board. The President of India will not be the visitor in IIMs, as is the case with centrally-funded institutions such as the IITs and central universities.

Let me be forthright in saying that the HRD Ministry after much resistance, has dropped finally the provision on the role of the Visitor – the President of India – in the IIMs. Instead, provisions have been created for periodic review of the performance of Institutions by independent agencies and placing the results of the same on public domain’ besides provision for a CAG audit of their annual reports. This is, in fact, much better and will serve its requisite purpose.

May it be added here that the overarching IIM Council has been replaced with a ‘coordination forum’ that is more than an ‘advisory body’. The Bill proposes a 15-member Board of Governors for each IIM, in which the HRD Ministry and state government will have representation, and a 30-member strong IIM coordination forum. Pitching for “complete autonomy to the Institutions”, the government has said that the management of these Institutions would be Board driven and both the chairperson and director of an Institution will be selected by the Board.

Be it noted, according to the Bill, the responsibility of running each IIM will be vested in its Board headed by a Chairperson who will be an eminent person from the field of education/industry/science or technology. Apart from the Chairperson, each Board will have a representative of the HRD Ministry, one of the state government, among others. Very rightly so!

Truth be told, the IIMs’ autonomy had been a widely debated issue, especially during the former Human Resource Development Minister Smriti Irani’s stint, when the B-schools had raised concerns over certain clauses in the draft Bill. This had raised quite a huge uproar. IIMs and the HRD Ministry had locked horns not only during the former HRD Minister Smriti Irani but also under the previous UPA regime as well.

It must be, however, added here that  later, the draft Bill had undergone several revisions, with the Minstry of HRD inviting IIM Directors and Chairpersons for a dialogue, following which a revised draft had been amicably worked upon offering a much liberalised framework for the IIMs which has now been finally approved by the Union Cabinet! Let me recall here that the first Committee to give some shape to the IIM Bill was Bhargava Committee in 2008. Following this, the first IIM Bill was proposed in 2012 during UPA-II regime!

As things stand, the HRD Minister, Prakash Javadekar, had earlier minced no words in asserting the government’s desire to grant greater autonomy to IIMs through the Bill. This is certainly a positive and welcome step. While welcoming the move, Ashish Nanda who is Director of IIM Ahmedabad said that, “Although we have not yet seen a copy of the IIM Bill approved by the Cabinet, Press Information Bureau release of 24 January and newspaper reports, as well as earlier assurances from the Minister suggest the Bill approved by the Cabinet adequately addresses IIMs’ concern about maintaining autonomy while ensuring accountability. We look forward to studying the Bill in detail, when it is available.”

It is imperative to mention here that the current draft provides for a Board of Governors’ driven management of IIMs wherein the Chairperson and Director can be selected by the Board itself. This means neither the HRD Ministry nor the President of India will have a say in the selection of top executives at these B-schools and so they would not be able to interfere in the selection process which is truly laudable. The Bill, however, rightly calls for greater participation of experts and alumni in the Board as well as inclusion of women and members from Scheduled Castes/Tribes (SC/ST) in the Board. There can be no denying or disputing this!

A noteworthy provision in this IIM Bill, 2017 is that it provides for a periodic review of IIMs’ performance by independent agencies. The annual report on the IIMs will be placed in Parliament for its scrutiny. CAG will also be auditing the IIMs’ audit. This will ensure that there is no major misappropriation of money.

No prizes for guessing that the Bill is expected to be tabled in the upcoming budget session of Parliament. No doubt, the present IIM Bill, 2017 is a great milestone and let us anticipate that it gets passed at the earliest by Parliament! Once it is passed, the IIMs would be allowed to grant degrees instead of diplomas. As a consequence, the Post Graduate Diploma in Management will become a Masters in Business Administration and the fellowship programme will become a PhD.

Last but not the least, all top private institutes like Symbiosis Institute of Management, Narsee Monjee Institute of Management Studies, SP Jain Institute of Management and Research and many other such institutions of eminence who rank heads and shoulders above some of the new IIMs too must be brought within the ambit of the IIM Bill and the students studying in these institutions must also get degrees and all such benefits as are conferred to those studying in IIMs! For this to happen, if Centre has to rename “IIM Bill” as “Management Education Bill” to cover all top management institutes, there is no harm in doing it. Now the ball is in the court of Centre, Cabinet and above all – Parliament without whose final approval it cannot ever become a law!

-Sanjeev Sirohi,