India’s Public Enterprises Selection Board (PESB)-led process for appointing directors and Chairmen & Managing Directors (CMDs) in public sector undertakings (PSUs) has devolved into a troubling cycle of narrow eligibility criteria, repeated interview failures declaring "no suitable candidate found," and recommendations for ad-hoc Search-cum-Selection Committees (SCSC) revealing deeper failures in how PSUs nurture internal leadership talent. Additionally, under Chairperson Mallika Srinivasan, the emphasis on technical, finance, and project experience systematically excludes operational leaders from human resources (HR)—depriving them of even interview opportunities. This isn't mere procedural inefficiency; it's a governance bottleneck imperiling PSUs' role in India's Viksit Bharat ambitions.
Narrowing the Gate: Criteria That Sideline HR Expertise
PESB vacancy advertisements for CMD roles exemplify the problem through rigidly defined Essential Qualifications (EQ). A typical circular requires candidates to possess "cumulative experience/exposure of at least five years in the last ten years in the areas of Finance/ Business Development/ Production/ Operations/ Marketing/ Project Management," with age limits tied to superannuation and a minimum of five years' residual service. HR, industrial relations, or people management—critical for PSUs employing millions—are conspicuously absent from these lists, rendering experienced executives ineligible before applications are even reviewed.
Ironically, this excludes professionals who might have spent bigger part of their career in technical or finance department but since they are in human resources for 7-8 year or more, they will not be eligible to appear even for the interview.
This technocratic bias has intensified under PESB's current leadership, where CMD criteria fetishize engineering pedigrees, financial wizardry, and project execution while treating HR as a mere support function. PSUs whether Maharatna, Navratna or Miniratnas, are not just balance-sheet machines; they're human enterprises grappling with employee management, talent retention amid the era of job shuffling, diversity mandates under Atmanirbhar Bharat.
HR veterans who've orchestrated turnarounds—quelling strikes, building leadership pipelines or embedding safety cultures at the public sector organisations—are barred at the threshold. Such exclusion mocks the Department of Public Enterprises (DPE) guidelines stressing "all-round competence" and deprives PSUs of leaders equipped for employee-centric challenges in Industry 4.0.
On a lighter note: if PESB's interviews so often flop, why deny HR professionals—a cadre with proven enterprise-wide impact—the basic right to appear? This isn't prudence; it's self-sabotage, artificially shallowing the talent pool and perpetuating leadership vacuums.
The Predictable "None Found Suitable" Parade
PESB's own record indicts the system. After shortlisting and interviewing, panels repeatedly conclude no one measures up, advising ministries to form SCSCs—a fallback that admits process failure. Specific cases paint the picture:
NTPC's CMD search in May 2025: PESB interviewed a dozen candidates but found none suitable, prompting SCSC recommendations amid Gurdeep Singh's retirement looming.
BPCL's CMD post in February 2025: Interviews yielded no recommendation, with PESB explicitly advising alternative mechanisms.
BCPL's MD vacancy in December 2025: PESB refrained from selecting anyone, again falling back on SCSC.
ECIL's CMD in September 2025: No suitable candidate emerged despite applications.
SAIL's Director (Commercial): None found suitable, leading to SCSC route.
Reports indicate over 40% of senior PSU postings in 2025—from MRVC's Director (Finance) to others—ended in dead ends. This repeatable pattern—constrict the pool via silos, interview the remnants, reject all, invoke SCSC—erodes PESB's credibility. If the endpoint is often external hunts anyway, broadening to include HR at the outset becomes not just fair, but logical.
Another Concern: PSUs' Systemic Failure to Nurture Leaders
These rejections spotlight a graver indictment: PSUs' chronic underinvestment in leadership development. "No suitable candidate found" isn't PESB's fault alone—it's proof that organizations aren't producing board-ready executives across functions. Key deficiencies include:
Siloed career trajectories: Executives rarely rotate across domains (e.g., projects to HR to finance), despite DPE guidelines advocating 15 years of diverse exposure for senior roles. Functional bunkers produce specialists, not strategists.
Technical over soft skills: Training budgets chase certifications in finance or engineering, neglecting negotiation, ethical leadership, change management, and culture-building—CMD essentials amid PSU reforms.
Short-termism in promotions: Immediate outputs trump long-term grooming; mentorship programs and leadership academies reach only 20-30% of executives.
In behemoths like some of the Maharatnas and Navratnas—no internal CMDs emerge, forcing disruptive outsiders who lack PSU DNA. S&P Global's 2025 governance warnings for PSUs cited not tech gaps, but operational rot including talent mismanagement. With renewables demanding new skills in critical minerals and defence PSUs eyeing indigenization, un-nurtured pipelines ensure half-baked boards.
HR Inclusion as the Ultimate Litmus Test
Explicitly listing "HR/Industrial Relations/Organizational Development" in EQ clauses would force accountability: Are PSUs grooming these leaders as CMD-caliber? HR has delivered where it matters—e.g. resolving Coal India disputes, NTPC skill initiatives, BPCL diversity drives. Preemptively excluding them evades the question: Can PSUs build holistic leaders for people-led challenges in the sector traversing through a period of radical change? Broadening criteria tests PESB's merit claims while exposing grooming gaps.
A Comprehensive Reform Imperative
No dilution of standards—just correct definitions. PSUs, PESB, DPE, and ministries must align:
PESB's echo chamber and PSUs' nurturing neglect ensure leadership limps—spreadsheets without human glue. Including HR and fixing pipelines will forge boards reflecting PSU realities: complex, people-powered engines of national growth. The clock ticks; another SCSC delays India's PSU renaissance.
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