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Part - II

One of the primary means of enhancing internal resources has been to charge what is perceived to be "market" tuition. This depends on the value perception and the means available to even a poor student to meet the tuition levels. Here the IIMs have the right resource. Banks give extremely cheap loans with long periods of repayment. Usually the saving from the first year of employment is enough to repay the entire cost of education for even an average IIM graduate. The toppers can recover their entire cost of education from child hood to post graduation in 6 months salary, not to speak of cars and houses. Hence the value perceived is very high, and has enabled the IIM's to charge a reasonable level of tuition, which would make them independent of the government dole in short order.

Probably this factor, and the politician's nose for detecting a source of money supply and power and prestige, frequently leads to actions, which are designed to create situations where the IIM's are more dependent, not less. This ought to be resisted mightily.

The right remedy for this situation is for the IIM Societies to elect their own boards and change their constitution to lessen the number of government nominees and have a broad based independent Board, which can resist purely 'political' suggestions of the government.

Does control of the IIM Society mean control of IIM the Institute?

Strange but it appears that IIM the Institute is quite different from IIM the Society. The argument is that the IIM Society is distinct from IIM the Institution itself! This is well recognized in all State education systems. For instance in Bangalore, The Bangalore Higher Education Society manages the BHS First Grade College in Jayanagar. However, the State recognizes the existence of only the college, and will give the grant into a college account operated by the Principal, and not into the Society account. This happens even though the college itself has no constitution, other than that it is promoted by the BHES Society. Extending the same argument, legal control of IIM Society does not imply the control of IIM the institute, which is a distinct legal person. This particular question has been (probably) addressed by High Courts, but never by SC. This is the right time to bring it up. The governance of an institution comes form it's practices, conventions, traditions and culture, and in British law resides in the person of the Chairman of the Board of Governors (else what do they govern, pray!). It is thus that the VC is the head of a University and the State Governor the Chancellor (Equal to a Visitor in the UK system).

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* Contributed by: -
Prof. P. V. Ramana; BE (Hons) Elec. Engg. from Andhra University, Waltair, India; MBA (Accounting & Finance) from Washington State University, USA; Prof. Engr. (Thermal Power), USA (equiv. to a Doctoral qualification); Receiver of Life Time Achievement award in 2003 for service to Management Education given by World HRD Congress, Boston, USA; Dr. P. N. Singh Foundation has instituted the "Prof. P. V. Ramana" for Corporate Governance; he has also founded ITM in 1991.