Parliamentary panel flags governance lapses at IREL as CMD post, all independent director seats lie vacant

New Delhi: A parliamentary panel has flagged serious corporate governance lapses at IREL (India) Limited, noting that the state-run rare earth miner has been functioning without a regular chairman and managing director (CMD) since November 2024 and with all four non-official independent director posts lying vacant.

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In its action-taken report tabled in Parliament, the Committee on Public Undertakings (CPU) said the absence of a full board not only hampers the functioning of the company but also violates established corporate governance norms applicable to central public sector enterprises.

No regular CMD since November 2024

The committee noted that the post of CMD has remained vacant since the superannuation of the previous incumbent on November 30, 2024. Since then, the Director (Finance) has been holding additional charge of the CMD position.

While acknowledging that the Public Enterprises Selection Board (PESB) has conducted interviews and recommended a candidate, the panel observed that the appointment is yet to receive approval from the Appointments Committee of the Cabinet (ACC), leaving the top leadership position unfilled.

Entire slate of independent directors vacant

The panel also flagged that all four posts of non-official independent directors on IREL’s board are vacant, reducing the board’s effective strength to half of its sanctioned capacity of 12 directors.

According to the committee, this situation is inconsistent with Department of Public Enterprises (DPE) guidelines, which require unlisted CPSEs to have at least one-third of their board members as independent directors.

Panel calls out governance norm violations

The CPU said prolonged vacancies at both the leadership and board levels undermine corporate governance principles and weaken oversight at a time when IREL is executing strategically critical projects in the rare earth and atomic minerals space.

While the Department of Atomic Energy (DAE) told the committee that it has taken up the matter with the DPE for appointment of independent directors and that efforts are ongoing, the panel said the response could only be treated as an interim reply.

Interim response, panel seeks resolution

The committee underscored that the continued absence of independent directors reflects challenges in consistently meeting governance norms and urged the government to take timely corrective measures.

It expressed confidence that further progress would be made but stressed the need for early resolution of the vacancies, given IREL’s strategic role in India’s rare earth supply chain and national security-linked sectors.

The panel said it would continue to monitor the issue as part of its oversight of the public sector undertaking.

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