Importance Of Private Sector

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1.0 Introduction The importance of Public Sector Units (PSUs) in the Indian economy can never be over emphasized. They account for over 22 % of the country’s GDP, around 6 % of the total employment in the organized sector and over 20 % of direct and indirect tax collections. A number of PSUs also serve critical functions of furthering the socio-economic objectives of the Government and ensuring stability in prices of key products and commodities. To some, a well-performing PSU is an oxymoron. The root cause, it is argued, lies in their ownership structure. The argument goes like this: a private sector owner treats the business as his own. Thus, the private sector is efficient and performs well. Therefore, the panacea to all that troubles the…show more content…
It is profitable, efficient and well performing. The largest shareholder in Volkswagen is the state of Lower Saxony in Germany. The case of Pohang Iron and Steel Company (Posco) is even more startling. The World Bank rejected the loan application of the Korean government for setting up a steel plant in Pohang — then a fishing village. No wonder, Korea neither had deposits of iron ore nor coking coal. The Korean government took the help of a consortium of Japanese bankers and set up Posco as a State Owned Enterprise (SOE). It is now the third largest producer of steel and doubtlessly one of the most efficient. It was only in 2000 that the company was fully…show more content…
ONGC is one of the organizations who have been following these guidelines even when it was voluntary for the companies to comply with these guidelines. As part of Corporate Governance initiatives, ONGC has inducted 4 Independent Directors on its board along with formation of various board level committees viz. Audit & Ethics Committee, Remuneration Committee, Health Safety & Environment Committee etc. 2. As part of the initiatives, NTPC has inducted 9 Independent Directors in its Board along with formation of Audit committee, remuneration committee, shareholder grievance committee etc. The organization has also formulated policies including whistle blower policy, ethical code of conduct, succession planning etc. Illustrative examples of Organizational Development/ Human Resource Management 1. Oil India Limited (OIL) has in place a ―Performance Management System‖ (PMS) with the objective to achieve enhanced work standards, identify knowledge & skills required, and inputs for succession planning. This system is used to track i) performance of its employees against Key Result Area (KRAs) linked to the overall objective of the organization and ii) identify development needs of

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