Independent directors on the board of Government banks have a key role to play: not only are they supposed to bring in expertise, their presence, as impartial monitors, is meant to signal trust to shareholders against corporate misgovernance.

For the UPA government, it seems, this doesn’t terribly matter.

Records investigated by The Sunday Express show that the Government has crammed at least 33 of the 37 positions for independent directors (called “non-official” directors, in banking parlance) with men and women known for their allegiance to the Congress party: at least five secretaries of the All India Congress Committee (AICC), a vice-president and a secretary of the All India Mahila Congress (AIMC) and the Sewa Dal — politicians who have lost elections or loyalists to whom the party wishes to dole out a favour.

It couldn’t be more brazen. For, in October 2005, The Indian Express had first exposed how seven Congress politicians were appointed as “independent directors” in these PSU Banks for a three-year period. Since then, the Congress takeover of this crucial position is virtually complete.

Ironically, the Department of Banking had prepared a list of top-notch professional experts who could have been appointed as directors. This list was ignored.

According to guidelines framed by the UPA soon after it came to power in 2004, an independent director will “ordinarily” be appointed from among those who have special academic training and experience in the fields of marketing, information technology and industry. The guidelines also stipulate that he/she should “at least be a graduate” but that educational qualifications may be relaxed with the approval of the Appointments Committee of the Cabinet in the case of “farmers, depositors and artisans.”

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