The chief executive

A chief executives are managing and give a direction to the

organization ,it also describes the position of the most senior

corporate officers, executives, leader or administrator in charge of

managing an organization. Generally,the word Chief executive has been

used in 4 cannotations,in other words the cheif executive lead a range

of organizations, including public and private corporations, non-profit

organizations and even some government organizations. There are a

variety of legal types of organizations, including corporations,

governments, non-governmental organizations, political organizations,

international organizations, armed forces, charities, not-for-profit

corporations, partnerships, cooperatives, and educational institutions.

Even in a A organization, the chiefe executive play a dominant role ,the

hybrid organization is a body that operates in both the public sector and

the private sector simultaneously, fulfilling public duties and developing

commercial market activities.

The chief executive and the nature of functions

The functions of chief executives are differed from organization to

organization. He can act as in following ways;

1. chief executive as head of the private organization

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2. chief executive as head of the public organization

3. chief executive as head of the state

4. chief executive as head of the government

1.chief executive as head of the private organization

In a private organization, the Position of chief executives Can Have Various Titles

This organizational position, whether in corporations or not, is also sometimes called the

President, Executive Director, Chief Administrator, Chief Executive Officer etc.

The private organization are mostly have corporate type organization that

has a board of directors, the "chief executive officer" is (usually) the singular

organizational position that is primarily responsible to carry out the strategic

plans and policies as established by the board of directors. In this case, the chief

executive reports to the board of directors. In a form of business that is usually

without a board of directors (sole proprietorship, partnership, etc.), the "chief

executive officer" is (usually) the singular organizational position (other than

partnerships, etc.) that sets the direction and oversees the operations of an

organization.

Major Roles of the Position of Chief Executive Officer

The following link references the major roles carried out by the typical chief executive
officer.
.

2
Roles of Chief Executive
NOTE: References to a Boards of Directors in the following are in regard to chief executives
of corporations, whether for-profit or nonprofit.

As a Leader

Advises the Board

Advocates / promotes organization and stakeholder change related to organization
mission
Supports motivation of employees in organization products/programs and operations

As a Visionary / Information Bearer

Ensures staff and Board have sufficient and up-to-date information

Looks to the future for change opportunities
Interfaces between Board and employees
Interfaces between organization and community

As a Decision Maker

Formulates policies and planning recommendations to the Board

Decides or guides courses of action in operations by staff

As a Manager

Oversees operations of organization

Implements plans
Manages human resources of organization
Manages financial and physical resources

As a Board Developer

Assists in the selection and evaluation of board members

Makes recommendations, supports Board during orientation and self-evaluation
Supports Board's evaluation of Chief Executive

Responsibilities of Chief Executive Officer

There is no standardized list of the major functions and responsibilities carried out by
position of chief executive officer. The following list is one perspective and includes the
major functions typically addressed by job descriptions of chief executive officers.

1. Board Administration and Support

Supports operations and administration of Board by advising and informing Board members,
interfacing between Board and staff, and supporting Board's evaluation of chief executive

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2. Program, Product and Service Delivery

Oversees design, marketing, promotion, delivery and quality of programs, products and
services

3. Financial, Tax, Risk and Facilities Management

Recommends yearly budget for Board approval and prudently manages organization's
resources within those budget guidelines according to current laws and regulations

4. Human Resource Management

Effectively manages the human resources of the organization according to authorized

personnel policies and procedures that fully conform to current laws and regulations

5. Community and Public Relations

Assures the organization and its mission, programs, products and services are consistently
presented in strong, positive image to relevant stakeholders

6. Fundraising (nonprofit-specific)

Oversees fundraising planning and implementation, including identifying resource

requirements, researching funding sources, establishing strategies to approach funders,
submitting proposals and administrating fundraising records.

2. chief executive as head of the public organization

In a private organization, the Position of chief executives Can Have Various

Titles,in other words,This organizational position, whether in corporations or not,
is also sometimes called the chief secretary, Executive officers, the chairman ,
Managing Director in Board type organizations, executive engineer(in slum
clearance board,TWAD etc),deputy secretory ,director,additional
director,superindent (of police) etc.

He is the leader any public organization Leader

Advises the department,directorates or Board etc

Advocates / promotes public organization and stakeholder change related to
organization mission
Supports motivation of department employees in organization

Visionary / Information Bearer

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 Ensures staff and governmental departments have sufficient and up-to-date
information
Looks to the future for change opportunities
Interfaces between public organizations and employees
Interfaces between any public organization and community

Decision Maker with participative strategy

Formulates policies and planning recommendations to the various governmental

organizations
Decides or guides courses of action in operations by staff

Managing day today works

Oversees operations of any public organization

Implements plans
Manages human resources of organization
Manages financial and physical resources

Appointment of officers who take charge office

Assists in the selection and evaluation of board members

Makes recommendations, supports Board during orientation and self-evaluation
Supports Board's evaluation of Chief Executive

-----------------------------------------------------------------------------------------

Leadership

Leadership is a personal or formal nature of quality that leading or directing

others or co-workers in an organization to achieve a particular goal. A leader in

a formal, hierarchical organization, who is appointed to a managerial position,

has the right to command and enforce obedience by virtue of the authority of his

position. However, he must possess adequate personal attributes to match his

authority, because authority is only potentially available to him. In the absence

of sufficient personal competence, a manager may be confronted by an

5
emergent leader who can challenge his role in the organization and reduce it to

that of a figurehead. However, only authority of position has the backing of

formal sanctions. It follows that whoever wields personal influence and power

can legitimize this only by gaining a formal position in the hierarchy, with

commensurate authority.[2]

Formal organizations

An organization that is established as a means for achieving defined objectives

has been referred to as a formal organization. Its design specifies how goals are

subdivided and reflected in subdivisions of the organization. Divisions,

departments, sections, positions, jobs, and tasks make up this work structure.

Thus, the formal organization is expected to behave impersonally in regard to

relationships with clients or with its members. According to Weber's definition,

entry and subsequent advancement is by merit or seniority. Each employee

receives a salary and enjoys a degree of tenure that safeguards him from the

arbitrary influence of superiors or of powerful clients. The higher his position in

the hierarchy, the greater his presumed expertise in adjudicating problems that

may arise in the course of the work carried out at lower levels of the

organization. It is this bureaucratic structure that forms the basis for the

appointment of heads or chiefs of administrative subdivisions in the

organization and endows them with the authority attached to their position. [3]

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 Informal organizations

In contrast to the appointed head or chief of an administrative unit, a leader

emerges within the context of the informal organization that underlies the

formal structure. The informal organization expresses the personal objectives

and goals of the individual membership. Their objectives and goals may or may

n Bo bunch thinkot coincide with those of the formal organization. The informal

organization represents an extension of the social structures that generally

characterize human life the spontaneous emergence of groups and

organizations as ends in themselves.

In prehistoric times, man was preoccupied with his personal security,

maintenance, protection, and survival. Now man spends a major portion of his

waking hours working for organizations. His need to identify with a community

that provides security, protection, maintenance, and a feeling of belonging

continues unchanged from prehistoric times. This need is met by the informal

organization and its emergent, or unofficial, leader.

Leaders emerge from within the structure of the informal organization. Their

personal qualities, the demands of the situation, or a combination of these and

other factors attract followers who accept their leadership within one or several

overlay structures. Instead of the authority of position held by an appointed

head or chief, the emergent leader wields influence or power. Influence is the

7
ability of a person to gain cooperation from others by means of persuasion or

control over rewards. Power is a stronger form of influence because it reflects a

person's ability to enforce action through the control of a means of punishment s.

Public Enterprises or Public Sector Undertakings

Public enterprise, a business organization wholly or partly owned by the state and

controlled through a public authority. Some public enterprises are placed under

public ownership because, for social reasons, it is thought the service or product

should be provided by a state monopoly. Utilities (gas, electricity, etc.), broadcasting,

telecommunications, and certain forms of transport are examples of this kind of

public enterprise.

Although the provision of these services by public enterprises is a common practice

in Europe and elsewhere, in the United States private companies are generally

allowed to provide such services subject to strict legal regulations. In some countries

industries such as railways, coal mining, steel, banking, and insurance have been

nationalized for ideological reasons, while another group, such as armaments and

aircraft manufacture, have been brought into the public sector for strategic reasons.

In communist countries most forms of production, commerce, and finance belong to

the state; in many newly independent and less-developed countries, there is a very

large public-enterprise sector.

In Europe the prevailing pattern is a mixed economy with the public enterprises

operating side by side with private corporations. In GreatBritain during the early

years of the 20th century, the post office, utilities, armaments, and the Port of

London belonged to the public sector; to them were later added various forms of

8
public transport, thus markedly widening the role of the state sector. Under the

194650 Labour government, a massive nationalization program was effected

embracing coal mining, the iron and steel industry, the gas industry, railways, and

long-distance road transport. During the Conservative regime of Prime Minister

Margaret Thatcher (197990), many public enterprises were privatized. The

postwar French government undertook a similar extensive nationalization program

that included banks, insurance companies, finance houses, and manufacturing

concerns. Many were subsequently privatized.

The United States has few public enterprises. They include, ironically, one of the

worlds models for such undertakings, the Tennessee Valley Authority, established in

1933. In 1970 the U.S. postal system, until then a department of the executive

branch of the federal government, became a government-owned corporation.

Public enterprises are by definition intended to be operated in the public

interest. This gives rise to a number of organizational and commercial issues. One

problem is how to reconcile the need for close political control with the need for

sufficient management autonomy. The public corporation form, used extensively in

Great Britain and widely copied in other parts of the world, is created by a special act

of Parliament that defines its powers, management structure, and relationship with

government bodies. As a corporation it has legal entity. Its capital requirements are

met by the treasury, but it is supposed to meet its current expenses from its normal

commercial operations. Its employees are not civil servants, and the top

management is often appointed by the minister in charge. Another administrative

form that is popular in parts of the world is the state company, which is simply an

ordinary joint-stock company whose shares are owned wholly or partly by the state.

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 Public enterprises are usually intended to pay their way in the longer term, and

yet they may be subject to political constraints in their pricing policy that could be in

conflict with that objective. Conversely, for social reasons they may receive hidden

subsidies or enjoy additional protection not available to competitors. Such factors

tend to distort the normal commercial operations of the corporation or the company

and often lead to managerial disorientation. Partly because of these noncommercial

considerations, public enterprises may appear to be highly inefficient and, in times of

difficult trading conditions, may be a drain on public resources. However, the

measurement of the efficiency of a public enterprise is no easy matter. When it

produces a marketable product, such as coal or steel, that competes with other

products, the normal commercial criterion of profit may be adopted to assess its

performance. In the case of a utility enjoying monopoly power, economists have

developed concepts like cost-benefit analysis as a performance measurement tool.

In recent years many state enterprises in the developed world have been given

financial targets that take into account both social and commercial responsibilities.

Public Enterprises in India

The government-owned corporations are termed as Public Sector Undertakings (PSUs) in
India. In a PSU majority (51% or more) of the paid up share capital is held by central
government or by any state government or partly by the central governments and partly
by one or more state governments. In India,public enterprises are functioning in
two forms the central public enterprises and the state public enterprises.At the
centre ,Central Public Sector Enterprises (CPSEs) are those companies in
which the direct holding of the Central Government or other CPSEs is 51% or
more.
As on 31.3.2015 there were 298 CPSEs wherein, 63 enterprises are yet to
commence commercial operation. Remaining 235 are operating enterprises
(covering 181 scheduled CPSEs & 54 CPSEs has been considered
provisional).
CLASSIFICATION OF PUBLIC SECTOR UNDERTAKINGS

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Public Sector Undertakings (PSUs) can be classified as Public Sector Enterprises (PSEs),
Central Public Sector Enterprises (CPSEs) and Public Sector Banks (PSBs).

The Central Public Sector Enterprises (CPSEs) are also classified into 'strategic' and 'non-
strategic'. Areas of strategic CPSEs are:

Arms & Ammunition and the allied items of defence equipments, defence air-
crafts and warships
Atomic Energy (except in the areas related to the operation of nuclear power and
applications of radiation and radio-isotopes to agriculture, medicine and non-
strategic industries)
Railways transport.

All other CPSEs are considered as non-strategic. For detailed information on the
classification and categorization of CPSEs,

MAHARATNA/NAVRATNA/MINIRATNA STATUS FOR PUBLIC

SECTOR UNDERTAKINGS

The status of Maharatna, Navratna, Miniratna to CPSEs is conferred by the Department

of Public Enterprises- External website that opens in a new window to various Public
Sector Undertakings. These prestigious titles provide them greater autonomy to compete
in the global market.

Maharatna

A company qualifying for the Maharatna- External website that opens in a new
window status should have an average annual turnover of Rs 20,000 crore during the
last three years against Rs 25,000 crore prescribed earlier. The average annual net
worth of the company should be Rs 10,000 crore.

The Maharatna status empowers mega CPSEs to expand their operations and emerge as
global giants. The coveted status empowers the boards of firms to take investment
decisions up to Rs 5,000 crore as against the present Rs 1,000 crore limit without
seeking government approval. The Maharatna firms would now be free to decide on
investments up to 15% of their net worth in a project, limited to an absolute ceiling of
Rs 5,000 crore.

Navratna

The Central Public Sector Enterprises (CPSEs) fulfilling the following criteria are eligible
to be considered for grant of Navaratna- External website that opens in a new
window status:

Having Schedule 'A' and Miniratna Category-1 status.

Having at least three 'Excellent' or 'Very Good' Memorandum of Understanding
(MoU) ratings during the last five years.

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For detailed information on criteria for Navratna status click here- External website that
opens in a new window.

The Navratna status empowers PSEs to invest up to Rs. 1000 crore or 15% of their net
worth on a single project without seeking government approval. In a year, these
companies can spend up to 30% of their net worth not exceeding Rs. 1000 cr. They also
enjoy the freedom to enter joint ventures, form alliances and float subsidiaries abroad.

Miniratna Category

For Miniratna category I status, the CPSE should have made profit in the last three years
continuously, the pre-tax profit should have been Rs. 30 crores or more in at least one of
the three years and should have a positive net worth. For category II, the CPSE should
have made profit for the last three years continuously and should have a positive net
worth.

Miniratnas can enter into joint ventures, set subsidiary companies and overseas offices
but with certain conditions. This designation applies to PSEs that have made profits
continuously for the last three years or earned a net profit of Rs. 30 crore or more in one
of the three years.

Miniratna Category-II CPSEs

Category II miniratnas have autonomy to incurring the capital expenditure without
government approval up to Rs. 300 crore or up to 50% of their net worth whichever is
lower.

ROLE OF PUBLIC ENTERPRISES IN INDIA

Public Sector Undertakings (PSUs) have laid a strong foundation for the
industrial development of the country. The public sector is less concerned
with making profits. Hence, they play a key role in nation building
activities, which take the economy in the right direction.

PSUs provide leverage to the Government (their controlling shareholder)

to intervene in the economy directly or indirectly to achieve the desired
socio-economic objectives and maximize long-term goals.

As agriculture is the backbone of Indian economy, Public Sector Banks

(PSBs) play a crucial role in pushing the agricultural economy on to the
progressive pathway and helping develop rural India. Moreover, PSUs
play a substantial role in the rural development by providing basic
infrastructural services to citizens.

EMPOWERMENT OF PUBLIC SECTOR UNDERTAKINGS

The Government provides Public Sector Enterprises (PSEs/PSUs) the necessary flexibility
and autonomy to operate effectively in a competitive environment. The Boards
of Navratna and Miniratna companies- External website that opens in a new window are

12
entrusted with more powers in order to facilitate further improvement in their
performance.

The government has also implemented revised salaries for executives of PSEs/PSUs.
Moreover, some innovative measures such as Performance Related Pay have been
introduced to make them more efficient. These incentives for the employees have been
linked to individual, group as well as company performance.

For further strengthening, the government is also encouraging the listing of Public Sector
Enterprises on the stock markets.

Latest Pay Revision Guidelines- External website that opens in a new window
Wage Policies & Related Matters
Feasibility Study for Implementing Performance Related Pay- PDF file that opens

in a new window

CORPORATE GOVERNANCE OF PUBLIC SECTOR

UNDERTAKINGS
Good corporate governance practices are essential for sustainable
business. It generates long term value to all its shareholders and other
stakeholders. The Ministry of Corporate Affairs has been working towards
strengthening of the corporate governance.

The ministry encourages the use of better practices through voluntary

adoption. For this purpose, a set of voluntary guidelines has been
drafted. The Corporate Governance Voluntary Guidelines serve as a
benchmark for the corporate sector and also help them in achieving the
highest standard of corporate governance.

CORPORATE SOCIAL RESPONSIBILITY OF PUBLIC SECTOR

UNDERTAKINGS

Social Obligations of Central Public Enterprises

PSUs serve the interest of society by taking responsibility for the impact of their
activities on customers, employees, shareholders, communities and the environment in
all aspects of their operations.

The Government has issued the guidelines on Corporate Social Responsibility for Central
Public Sector Enterprises (CPSEs) following the Committee on Public Undertakings
(1993-94) recommended a number of measures in its 24th Report on 'Social
Responsibilities and Public Accountability of Public Undertakings'.

13
Although the Government believes in making PSEs growth oriented and technically
dynamic, its policy is to give greater powers to the boards so that PSEs could function
professionally. While the focus is on generating surpluses for self-sustaining growth, the
PSEs generally undertake certain amount of non-commercial responsibilities, in
furtherance of their commercial objectives. All PSEs cannot be treated on an equal
footing for undertaking various types of social activities. It is for the individual PSE to
identify and implement social responsibilities keeping in view its financial ability to
sustain such activities, operating environment and provisions in its MOA/Statute.

It is likely that some social responsibilities may be assigned to PSEs through the
issuance of Presidential Directives/guidelines by the concerned administrative
Ministries/Departments. While implementation of Presidential Directives is mandatory;
the guidelines are also generally to be followed except when the boards of directors of
PSEs decide not to adopt them for reasons to be recorded in writing. It is desirable that
boards of PSEs have full flexibility in identification and implementation of social
responsibilities because as per the Articles of Association they enjoy full autonomy in this
regard. PSEs are free to avail the help of State Governments, District Administration and
peoples' representatives, wherever necessary.

EVOLUTION AND GROWTH OF PUBLIC ENTERPRISES IN INDIA

IN Post ndependence, India was grappling with grave socio-economic problems, such as
inequalities in income and low levels of employment, regional imbalances in economic
development and lack of trained manpower, weak industrial base, inadequate
investments and infrastructure facilities, etc.

Hence, the roadmap for Public Sector was developed as an instrument for self-reliant
economic growth. The country adopted the planned economic development polices,
which envisaged the development of PSUs.

Initially, the public sector was confined to core and strategic industries. The second
phase witnessed nationalization of industries, takeover of sick units from the private
sector, and entry of the public sector into new fields like manufacturing consumer
goods, consultancy, contracting and transportation etc.

The Industrial Policy Resolution 1948 outlined the importance of the economy and its
continuous growth in production and equitable distribution. In this process, the policy
envisaged active engagement of the State in development of industries.

The Industrial Policy Resolution 1956 classified industries into three categories with
respect to the role played by the State -

The first category (Schedule A) included industries whose future development

would be the exclusive responsibility of the State
The second (Schedule B) category included Enterprises whose initiatives of
development would principally be driven by the State but private participation
would also be allowed to supplement the efforts of the State
And, the third category included the remaining industries, which were left to the
private sector.

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In 1969, the government nationalized 14 major banks.

The Industrial Licensing Policy 1970 placed certain restrictions on undertakings

belonging to large industrial houses, defined on the basis of assets exceeding Rs 350
mn.

In 1973, the definition of large industrial houses was adopted in conformity with that
of the Monopolies and Restrictive Trade Practices Act (MRTP) 1969- External website
that opens in a new window and included companies whose assets exceeded Rs 200
mn.

The Statement on Industrial Policy in July 1991 was also significant. It brought in
fundamental changes in the MRTP Act as well. The statement revised the priority of the
public sector.

Examples of public enterprises

Export Credit Guarantee Corporation of India Limited (ECGC)

India Trade Promotion Organisation (ITPO)
Minerals and Metals Trading Corporation Limited (MMTC)
National Centre for Trade Information (NCTI)
State Trading Corporation of India Limited (STCI)

Indian Telephone Industries Limited (ITI Limited

GROWTH OF INDEPENDENT REGULATORY COMMISSIONS IN INDIA

An Independent regulatory agency (also regulatory authority, regulatory

body or regulator) is a public authority or government agency responsible for exercising

autonomous authority over some area of human activity in

a regulatory or supervisory capacity. An independent regulatory agency is a regulatory

agency that is independent from other branches or arms of the government.

15
 Regulatory agencies in the area of administrative law, regulation or rule

making (codifying and enforcing rules and regulations and imposing supervision or

oversight for the benefit of the public at large) play a pivotal role. The existence of

independent regulatory agencies is justified by the complexity of certain regulatory and

supervisory tasks that require expertise, the need for rapid implementation of public

authority in certain sectors, and the drawbacks of political interference. Some

independent regulatory agencies perform investigations or audits, and other may fine the

relevant parties and certain measures.

Regulatory agencies are usually a part of the executive branch of the government,

and they have statutory authority to perform their functions with oversight from the

legislative branch. Their actions are generally open to legal review. Regulatory

authorities are commonly set up to enforce standards and safety or to oversee use

of public goods and regulate commerce. Examples of regulatory agencies are

the Interstate Commerce Commission and the Food and Drug Administration in

the United States, the Medicines and Healthcare Products Regulatory

Agency and Ofcom in the United Kingdom, and the Telecom Regulatory

Authority in India. and Internet regulation in Turkey for additional examples. In India ,for

every fields or administrative area india ,there are number of regulatory agencies

agencies functioning in those areas. For example

The following is a list of regulators in the varioius administrative areas

REGULATORS EXERCISE REGULATORY OR SUPERVISORY AUTHORITY OVER A

VARIETY OF ENDEAVORS IN INDIA.

Sectors Regulator Established Website

Inland Waterways for Inland Waterways 27-Oct-

[1]
shipping and navigation Authority of India 1986

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 National Highways
National Highways 1988 [2]
Authority of India

Forward Markets
Commodity Market 1953 [3]
Commission

Telecom
Telecommunication 20-Feb-
Regulatory [4]
Industry 1997
Authority of India

Institute of
Financial Audit and Chartered
1-May-1949 [5]
Accounting professions Accountants of
India

Financial system and Reserve Bank of 01-Apr-

[6]
monetary policy India 1935

Food Safety and

Food Safety Standards Authority Aug-2011 [7]
of India

Securities and
12-Apr-
Security Market Exchange Board of [8]
1992
India

Airports Economic
12-May-
Aeronautical Tariff Regulatory [9]
2009
Authority

Insurance
INSURANCE Regulatory and
1999 [10]
industry Development
Authority

Company- related Registrar of

1956 [11]
matters Companies

Central Electricity
Power sector Regulatory 24-Jul-1998 [12]
Commission

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 Pension Fund
Regulatory and 10-Oct-
Pension sector [13]
Development 2003
Authority

Warehousing Atomic
Atomic
Development and Energy
Warehouses 2007 [14] Energy 1983
Regulatory Regulatory
Sector
Authority Board

Categories:

Functions of Independent regulatory commissions

To ensure that it does fill its role, a regulatory agency uses mechanisms such as the
following

transparency of information and decision-making

procedures of consultation and participation
requirement that administrators give reasons explaining their actions
requirement that administrators follow principles thatPROMOTE non-arbitrary and
responsive decisions.
arrangements for review of administrative decisions by courts or other bodies

APPROCHES OF REGULATORY COMMISSIONS IN INCREASING THE

EFFICIENCY IN PUBLC ORGANIZATION

Regulation by government through its own Departments or Agencies directly under its
control has always existed. The last century has seen the emergence of aSPECIAL
category of regulatory systems - the Independent Statutory Regulating Agencies.

These agencies differ from the conventional regulating system as they are separated
from the executive wing of the government and enjoy a certain degree of autonomy.

The concept of independent regulations took birth in the USA. A large number of
Federal Agencies were set up by Acts of Congress, the basic premise of the
establishment of these agencies being that a market based economy needs to be
regulated inORDER to ensure a level playing field to all and also to safeguard the
larger public and national interest.

Other factors, which favoured the creation of independent regulations, were -

increasing complexities and the advancement of technologies required handling of
issues by experts; public interest is best served by insulating decision making in
certain issues, from political interference.

In India, with the initiation of the process of economic liberalization in the early 90s,
government withdrew from many activities which, hitherto were monopolized by it.
The entry of the corporate sector necessitated certain measures to boost the investor
competence and to safeguard public interest. One such measure was setting up of
independent regulators.

18
 In addition, the traditional departmental structure of government was not best suited
to play the dual role of a policy making as well as regulating the sector concerned,
more so, because in several sectors there were public sector units competing with
corporate bodies.

The aforesaid circumstances led to the setting up of several independent statutory

regulating agencies in sectors such as Power, Telecom, Financial
services,INSURANCE etc.

There is one more category of regulators - Self Regulatory Authorities. These

Authorities are created under different laws but they are self regulatory in nature.
The functions of Self-Regulatory Bodies may include: (i) issues of professional
education: development of curriculum, setting up of teaching standards, institutional
infrastructure, recognition of degrees etc. and (ii) matters connected with licensing,
and ethical conduct of the practitioners.

There are organizations like the Institute of Engineers which was formed purely by
voluntary action by the respective members of the profession. They do not have any
statutory background.

Financial Regulatory Bodies In India

The financial system in India is regulated by independent regulators in the field of banking,INSURANCE ,
capital market, commodities market, and pension funds. However, Government of India plays a significant
role in controlling the financial system in India and influences the roles of such regulators at least to some
extent.

The following are five major financial regulatory bodies in India:- (We have given links for these bodies.
For more details about these you can click and visit such websites)

(A) Statutory Bodies via parliamentary enactments:

1. Reserve Bank of India : Reserve Bank of India is the apex monetary Institution of India. It is also called as

the central bank of the country. The Reserve Bank of India was established on April 1, 1935 in accordance

with the provisions of the Reserve Bank of India Act, 1934. The Central Office of the Reserve Bank was

initially established in Calcutta but was permanently moved to Mumbai in 1937. The Central Office is where

the Governor sits and where policies are formulated. Though originally privately owned, since

nationalization in 1949, the Reserve Bank is fully owned by the Government of India. It acts as the apex

monetary authority of the country. The Central Office is where the Governor sits and is where policies are

formulated. Though originally privately owned, since nationalization in 1949, the Reserve Bank is fully

owned by the Government of India. Thepreamble of the reserve bank of India is as follows:

"...to regulate the issue of Bank Notes and keeping of reserves with aVIEW to securing monetary

stability in India and generally to operate the currency and credit system of the country to its advantage."

19
2. Securities and Exchange Board of India : SEBI Act, 1992 : Securities and Exchange Board of India (SEBI)

was first established in the year 1988 as a non-statutory body for regulating the securities market. It

became an autonomous body in 1992 and more powers were given through an ordinance. Since then it

regulates the market through its independent powers.

3. Insurance Regulatory and Development Authority : The INSURANCE Regulatory and Development

Authority (IRDA) is a national agency of the Government of India and is based in Hyderabad (Andhra

Pradesh). It was formed by an Act of Indian Parliament known as IRDA Act 1999, which was amended in

2002 to incorporate some emerging requirements. Mission of IRDA as stated in the act is "to protect the

interests of the policyholders, to regulate,PROMOTE and ensure orderly growth of the insurance industry

and for matters connected therewith or incidental thereto."

(B) Part of the Ministries of the Government of India :

4. Forward Market Commission India (FMC) : Forward Markets Commission

(FMC) headquartered at Mumbai, is a regulatory authority which is overseen by

the Ministry of Consumer Affairs, Food and Public Distribution, Govt. of India. It

is a statutory body set up in 1953 under the Forward Contracts (Regulation) Act, 1952

This Commission allowsCOMMODITY TRADING in 22 exchanges in India, out of which three are

national level.

4. PFRDA under theFINANCE Ministry : Pension Fund Regulatory and Development

Aulthority : PFRDA was established by Government of India on

23rd August, 2003. The Government has, through an executive order

dated 10th October 2003, mandated PFRDA to act as a regulator for the

pension sector. The mandate of PFRDA is development and regulation of

pension sector in India.

20
 I. TRAI TELECOM REGULATION AUTHORITY OF INDIA

History
Telecom Regulatory Authority of India was established on 20 February 1997 by an Act of
Parliament to regulate telecom services and tariffs in India. Earlier regulation of telecom
services and tariffs was overseen by the Central Government.

TRAI's mission is to create and nurture conditions for growth of telecommunications in India
to enable the country to have a leading role in the emerging global information society. [3]

One of its main objectives is to provide a fair and transparent environment that promotes a
level playing field and facilitates fair competition in the market. TRAI regularly issues orders
and directions on various subjects such as tariffs, interconnections, quality of service, Direct
To Home (DTH) services and mobile number portability.

In January 2016, TRAI introduced an important change in telecommunication that would

benefit all consumers. Effective from 1 January 2016, consumers will be compensated for
call drops. However, there is a catch, per the rule, mobile users will get a compensation of Re
1 for every dropped call but it will be limited to a maximum three dropped calls in a day. This
regulation has been quashed by Supreme Court on the ground of being "unreasonable,
arbitrary and unconstitutional".[4]

Secretariat

TRAI is administered through a Secretariat headed by a secretary. All proposals are

processed by the secretary, who organises the agenda for Authority meetings (consulting with
the Chairman), prepares the minutes and issues regulations in accordance to the meetings.
The secretary is assisted by advisors. These include Mobile Network, Interconnection and
Fixed Network, BroadBand and Policy Analysis, Quality of Service, Broadcasting & Cable
Services, Economic Regulation, Financial Analysis & IFA, Legal, Consumer Affairs &
International Relation and Administration & Personnel. Officers are selected from the
premier Indian Telecommunications Service and also from the Indian Administrative
Service.[5]

II. Insurance Regulatory and Development Authority of India

(IRDAI)
is an autonomous apex statutory body tasked with the regulation and promotion of the
insurance and Re-insurance industries in India.[2] It was constituted by an Act of Parliament
called the Insurance Regulatory and Development Authority Act, 1999,[3] duly passed by the
Government of India.[4]

The agency operates from its headquarters at Hyderabad, Telangana where it shifted from
Delhi in 2001.[5]

21
 PUBLIC ADMINISTRATION IN THE ERA OF GLOBALIZATION

Introduction
Globalization has brought about a transformation at virtually all levels of human activity that
is unprecedented and cannot even be rivalled by industrialization as the latter took part in
only a small part of the world. While there is still disagreement about when exactly
globalization began there were two distinctive developments at the beginning of the 1990s
which undeniably at least accelerated the process of globalization.

Like maybe no other invention the Internet has become identified with globalization as it
perfectly represents the opportunities created by new communication technologies. At least in
cyber space the global village already exists. The Internet and other vastly improved
communication methods have not only made it possible to exchange money and stocks
worldwide in a moments notice but ideas, opinions and information as well.

The second development contributing to globalization is rather political in nature. The fall of
the Berlin Wall in 1989 marked the beginning of the end of the Cold War era which
witnessed its final event with the collapse of the Soviet Union in 1991. In the new unipolar
world order there was an increasing pressure to uniformity, i.e. to adopt the Western form of
democracy and market capitalism. It was believed that globalization would lead to the
emergence of a global culture based on Western values. This was however met with fierce
resistance from certain cultural groups leading to prophecies of a future Clash of
Civilizations.[1]

While it was initially feared that globalization would [...] bring in its trail a pathological
process of recolonization [...][2] because it seemed to benefit mainly the developed
countries this assumption has not fully materialized. There are winners and losers in every
part of the world and many countries, especially in Asia and South America have catapulted
themselves onto the global stage by achieving almost miraculous economic growth.
However, globalization has led to a widening gap between rich and poor both among and
within countries. Indeed, the process of globalization has been to a large extent shaped by
transnational corporations which form alliances with local power elites and therefore attain a
considerable influence over the economic, political, and social welfare of many nations.[3]

Public administration has been amidst these developments as it is responsible for carrying out
new policies while at the same time being exposed to the impacts. There is hardly any dispute
about the argument that globalization will have profound effects on public administration; yet
it is not clear what these effects will be. A rather general account proposes a functional
change from steering to rowing.[4] This paper attempts to provide a brief overview on
current trends in administrative practice as well as on challenges and opportunities
globalization brings about for public administration.

1. Trends

22
While it may still be too early for a comprehensive account about the effects of globalization
on public administration there are a few distinctive trends that have emerged in both
administrative practice and theory. It would seem appropriate at this point to take a separate
look at public administration in developed and developing countries as obviously their
respective tasks are quite distinguishable from each other. It shall be argued here, however,
that the developments in public administration are surprisingly similar worldwide. This
startling fact becomes a little more explicable when we consider the implications of the
Ecological Approach developed by John Gaus and sophisticatedly enhanced by Fred W.
Riggs. The Ecological Approach advises us to study public administrations in the context of
the environment in which it takes place since both administration and environment are in an
interdependent relationship with each other.[5] It follows from this that because globalization
represents a significant part of the environment of virtually all public administrations in the
world today its implications should be connatural as well. We shall see, however, whether
this assumption can be upheld.

There has been a perplexing variety of prognoses regarding the future of public
administration in the age of globalization. Quite a significant number of researchers went as
far as to predict the decline or even the end of public administration.[6] While these
accounts have proved to be exaggerated it nevertheless has become clear that the role of
public administration has undergone substantial changes which can be summarized with the
terms privatization, decentralization, and downsizing. It could be argued that these three
trends have emerged irrespective of globalization as for instance the New Public
Management Approach, which became popular in the 1980s, calls exactly for these kinds of
measures in order to make public administration more efficient, dynamic, people- oriented
and accountable by introducing private administration methods.[7] Notwithstanding this fact it
is quite obvious that not only the first major features of globalization such as increased
international trade or new communication technologies had already appeared by that time but
that the pressure especially on administrations in developing countries increased immensely
in the 1990s when the process of globalization accelerated and the global era began. For the
purpose of this paper it is not necessary to distinguish causes and effects of these
developments. We may simply conclude that under globalization there has been an enormous
pressure on almost all public administrations in the world to privatize, decentralize and
downsize.

According to Ali Farazmand, these developments led to a change in the character of public
administration from civil administration to non-civil administration; i.e. the balanced
administrative state has been replaced by the corporate- coercive state which is characterized
by a massively growing coercive bureaucracy in charge of incarcerating millions of citizens
considered potential threats to social order.[8] It may be added that in developed countries
this manifested itself in a withdrawal of the welfare state while in developing countries it
meant a redefining of development; i.e. development was reduced to its economic dimension
and became and end in itself. In both the developed and the developing word the public
sphere has been decreasing leading to less public spiritedness[9].

1.1 Privatization

Privatization takes place in at least two different spheres of public administration: 1)

Formerly state- owned companies and enterprises become privatized and 2) public services
are delegated to non- state actors.

23
Many countries in the West as well as in the developing world used to run what they
considered to be key industries themselves. In the West these included primarily
infrastructural industries such as railways, communications or the energy industry. It was
believed that the running of these important industries could not be left to private and market
forces. In addition to that many developing countries also controlled industrial sectors
deemed essential for development. However, most of the state- owned companies failed to
operate efficiently and least of all were able to take profits. This was largely due to their
bureaucratic structure and the fact that they possessed a monopoly in their respective sector.
In an attempt to improve efficiency and competition these companies were privatized and the
industries opened to other private actors. Many states did however retain a significant share
in their former possessions or exempted a few companies from privatization all together.
While it remains to be seen what the long- term implications of privatization will be it
undeniably has had a substantial impact on public administration functions. As a result of
privatization public administration is less involved in producing services and goods now but
instead has become an articulator of demand, a purchaser of services, a monitor of
performance, and a regulator of markets. These functions are not entirely new to public
administrations, rather they are merely expanded.

What we encounter here is an obviously paradox situation: privatization has not led to a
decrease of government and administrative activities, rather the opposite is true. This will
become clearer when we take a look at the second sphere of privatization. While the overall
functions of administrations have rather increased the public sphere has nevertheless
shrunk because the expanded functions are less public- oriented. The space created by the
states retreat has rapidly been occupied by a confusing variety of non- state actors which
have substantially proliferated in the course of globalization.[10] Thus, non- state actors carry
out more and more functions which originally belonged to the domain of public
administration. Non- state actors assume their new roles of delivering public services in many
different ways. A method that has become increasingly popular especially among developed
countries is a contract between governments and non- state actors through which the latter are
assigned the task to provide specific services. The range of services open to contracting
seems to be alarmingly wide as the following example from the United States illustrates. In
the US, many state governments rely on non- governmental organizations to provide services
granted by the State Childrens Health Insurance Program (CHIP) and in the states of Florida
and Texas many components of welfare programs are now delivered through contracts with
private profit and non-profit agencies.[11] As we can see, governments do not even shrink
away from handing over the responsibilities for core services to profit- oriented
organizations.

Another example possibly illustrates even more the way in which state responsibilities have
been appropriated by non- state actors. The relief efforts in the wake of the 2004 tsunami
which devastated many coastal areas along the Indian Ocean and brought death to an
estimated 3,0 lakh of people were largely carried out by non- governmental organizations. As
the capabilities of most of these organizations are both structurally and financially limited
there is obviously the need to coordinate their activities. Unfortunately, public
administrations have so far not been able to adequately adapt to their new functions and in the
case of the tsunami this led to an unequal distribution of aid among the affected areas.[12]

The examples presented here relate to three distinguished types of privatization: divestment of
formerly state- run enterprises, delegation of responsibilities through contracting and, finally,
displacement, a somewhat passive process that leads to a governments being displaced

24
more or less gradually by the private sector... and may occur by default, by withdrawal, or
by deregulation.[13]

1.2. Downsizing

Public administrations and other large organizations are often believed to have an inherent
tendency to perpetually expand. This phenomenon has been described first by Cyril Nothcote
Parkinson whose findings, although not intended to be taken too seriously, have nevertheless
become quite popular. Parkinson had observed that work expands so as to fill the time
available for its completion and that the matters most debated in a deliberative body tend to
be the minor ones where everybody understands the issues.[14] Based on these observations
he formulated his laws according to which the number of employees in an organization will
steadily increase because any official would prefer to have more subordinates instead of more
superiors or rivals and because officials generally would tend to create work for each
other.[15]

It obviously follows from this that an expanding organization or administration would rather
sooner than later require an expanding budget as well. Thus, downsizing aims first and
foremost at limiting and controlling public finances but there may be other motivations such
as ideological ones as well. A specific function or program of an administration could be
targeted because it does not benefit certain groups who would likely try to impede the further
implementation of that function or program by depriving the administration of its financial
and human resources. However, any attempt to downsize an organization should not count on
its cooperation but instead prepare for open resistance against or more subtle mitigation of the
downsizing effort.[16]

As most of the public administrators worldwide are protected against dismissal an indirect
approach to attain significant downsizing measures seems more likely to succeed. Even then
a general societal climate in favour of redefining the role of the state and accepting a
diminished role of public administration appears to be a precondition. Public administrations
in countries with either a traditionally strong bureaucracy, high popular expectations towards
the state, or a combination of both have so far been able to avoid substantial cutback
attempts. It should furthermore be emphasized that downsizing administrations of countries
with strong centrifugal forces could have serious consequences and eventually lead to
disintegration. Downsizing therefore needs to be thoroughly considered, carefully carried out,
and should be based on a broad consensus

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