In a significant move, the Finance Ministry has asked all Public Sector Banks (PSBs) and state-owned financial institutions, including insurance companies, to report vigilance-related matters concerning their Whole-Time Directors (WTDs) promptly. The action is aimed at plugging the gap and bringing transparency to key board-level postings and placement.
The central government is believed to have done so after observing the omission of significant information, particularly information related to appointments, promotions, board-level postings, and placement of WTDs.
A ministry official described it as a matter of serious concern, and added strict compliance in such matters is expected from public sector units, or PSUs.
The basis of this decision was provided by the Department of Financial Services (DFS) which said in its directive that there were several instances where adverse information about board-level appointees was not promptly reported.
It further explained that in many cases, adverse inputs like private complaints, court observations, references or inputs from the CBI or other law enforcement agencies were reported only at the time of seeking vigilance clearance from the chief vigilance officers of PSUs.
The advisory, issued earlier this month, says that in certain cases even the crucial information relating to WTDs is omitted in the vigilance clearance formats on the ground that no specific column exists for such disclosure.
It is not all; PSBs and financial institutions have also been directed to immediately report adverse inputs regarding board-level officials. Besides, they have also been advised to submit comprehensive disclosure in vigilance clearance, which would include observations or directions of courts or tribunals, internal committee findings, audit observations of a serious nature, and communications from any department or agency.
In an unusual move earlier this year, the central government demoted Union Bank of India Executive Director (ED) Pankaj Dwivedi to general manager (GM) of Punjab & Sind Bank due to an ongoing case in the Delhi High Court. But this crucial information was not disclosed before.
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