MS-92

Identify a PE of your choice and try to develop a case on its social responsibility policies.

2009-06-14T03:17:00.000-07:00

Identify a PE of your choice and try to develop a case on its social responsibility policies.

Social responsibility policy
Social responsibility policy covers the environment, purchasing, personnel, occupational safety and communications.
Environment

TVO follows the principle of sustainable development. TVO assumes responsibility for the environment by minimising the harmful effects of the Company's operation and by ensuring appropriate management of the generated waste; observes and studies the state of the environment and takes immediate corrective action when required. TVO maintains the employees' competence and expertise on environmental issues at a high level. TVO aspires to act as a pioneer in the management of environmental issues.

TVO's objective is to further reduce the already low emissions of radioactive substances in compliance with the principle of prevention and continuous improvement. Any changes caused by the plant process are monitored proactively and in readiness to fight any harmful environmental impact caused by them.

TVO acknowledges the significance of total responsibility for all stages of the fuel cycle. The Company monitors and controls the fuel suppliers' management of environmental issues. TVO requires that the suppliers accept responsibility for securing and developing living conditions in the regions near the mining areas showing consideration for the aboriginal people. Fuel is accounted for from the uranium mines to final disposal, according to the "from rock to rock" principle.

TVO minimises the amount of generated waste by ensuring efficient use of energy, supplies and raw materials and by developing practical reuse of waste. The objective is to increase the proportional share of utilisable community waste and to reduce the amount of radioactive waste generated within the controlled area. TVO also makes efforts to reduce the amount of spent fuel by optimising the properties and the use of the fuel.

Any harmful effects and disturbances to the environment during the construction project of the new nuclear power plant unit are minimised as effectively as possible. Special attention is paid to the amount of generated waste and to the utilisation of the waste.

Purchasing
The purchased products and services shall meet the quality and environmental requirements specified by TVO. The availability of products and services critical to the operation of the Company is ensured by means of long-term agreements based on mutual trust and partnership.
The selection criteria for suppliers emphasise the continuity of the supplier's operation, their delivery reliability, management of quality and environmental issues as well as competitiveness. Domestic and local suppliers are favoured. The suppliers are reviewed and the quality of the deliveries is monitored; immediate corrective action is taken if required.
Personnel

TVO ensures that the personnel perform work tasks in a responsible manner, displaying motivation, competence and commitment to observing procedures that have been agreed on.
TVO ensures that the personnel resources of the Company are sufficient to achieve the objectives set for the Company. The availability of competent professional staff is ensured by a competitive pay scale that encourages effective performance of work, good daily practices and achievement of long-term objectives.

The principles of the human resources policy are implemented in good cooperation with the personnel.

TVO's objective is a work community based on equality, where no discrimination is allowed and where the achievement of equality is promoted. All employees are offered equal opportunities for professional and career development regardless of their sex or age.

TVO provides opportunities to the personnel to maintain and develop their working ability.

Occupational safety

The objective of the Company's occupational safety efforts is to promote health and occupational safety in compliance with the zero-accident philosophy.

TVO maintains a good work place atmosphere and working conditions. The Company and the staff do not approve discrimination, harassment or bullying in the work place. The occupational safety objective of everybody working in the plant area is to look after their own safety and the safety of their colleagues. Occupational safety is considered in all operations.

Communications

TVO communicates about events in the company and in the Olkiluoto nuclear power plant in an open manner and promotes public knowledge about nuclear power. TVO considers it important to ensure the interest groups' awareness of the necessity, properties and environmental impact of nuclear power.

Olkiluoto Visitors' Centre serves everybody interested in the operation of the Company with an exhibition open to all visitors.

The Company acts as a good corporate citizen. Internal communications ensure that the personnel are swiftly informed about any special events that may influence the operation of the plant and the Company, and are always aware of the Company's policies and decisions as well as of both financial and production status.

What are the strategic issues arising out of privatization? Discuss any two.

2009-06-14T03:12:00.000-07:00

What are the strategic issues arising out of privatization? Discuss any two.

PRIVATISATION: Privatisation is the process of involving the private sector in the ownership or operation of a state owned or public sector undertaking. It can take three forms: (i) Ownershijp measures; (ii) Organisational measures; and (iii) Operational measures.
(i) Ownership measures: The degree goes privatisation is judged by the extent of ownership transferred from the public enterprises to the private sector. Ownership may be transferred to an individual, co-operative or corporate sector. This can have three forms:
(a) Total denationalization implies 100 per cent transfer of ownership of a public enterprise to private sector.
(b) Joint venture implies partial transfer of a public enterprise to the private sector. It can have s3everal variants – 25% transfer to private sector in a joint venture implies that majority ownership and control remains with the public sector. 51% transfer of ownership to the private sector shifts the balance in favour to the private sector, through the public sector retains a substantial stake in the undertaking. 74% transfer of ownership to the private sector implies a dominant share being transferred to private sector. In such a situation, the private sector is in a better position to change the character of the enterprise.
(c) Liquidation implies sale of assets to a person who may use them for the same purpose or some other purpose. This solely depends on the preference of the buyer.
(d) Workers’ co-operative is a special form of dentionalisation. In this form, ownership of the enterprises is transferred to workers who may form a co-operative to run the enterprise. In such a situation, appropriate provision of bank loans is made to enable workers to buy the shares of the enterprise. The burden of running the enterprises rests on the workers in a workers’ co-operative. The workers become entitled to ownership dividend besides getting wages for their services.
(ii) Organizational measures include a variety of measures to limited state control. They include:
(a) A holding company structure may be designed in which the government limits its control to top level major decisions and leaves a sufficient degree of autonomy for the operating companies in their day-to-day operations. A big company like the Steel Authority of India (SAIL) or Bharat Heavy Electricals Limited (BHEL) may acquire a holding company status, thereby transferring a number of functions to its smaller units. In this way, a decentralised pattern of management emerges.
(b) Leasing: In this arrangement, the government agrees to transfer the use of assets of a public enterprise to a private bidder for a specified period, say of 5 years. While entering into a lease, the bidder is required to give an assurance of the quantum of profits that would be made available to the state. This is a kind of tenure ownership. The government reserves the right to review the lease to the same person or to grant the lease to another bidder depending upon the circumstances of the cases.
(c) Restructuring is of two types: financial restructuring and basic restructuring.
(1) Financial Restructuring implies the writing off of accumulated losses and rationalization of capital composition in respect of debt-equity ratio. The main purpose of this restructuring is to improve the financial health of the enterprise.
(2) Basic Restructuring is said to occur when the public enterprise decides to shed some of its activities to be taken up b ancillaries or small scale units.
(iii) Operational measures: The efficiency of public sector enterprises depends upon the organizational structure. Unless this structure grants a sufficient degree of autonomy to the operators of the enterprise of develops a system of incentives, it cannot raise its efficiency and productivity. These measures include: (a) grant of autonomy to public enterprises in decision making, (b) provision of incentives for workers and executives consistent with increase in efficiency and productivity, (c) freedom to acquire certain inputs from the markets with a view to reducing costs, (d) development of proper criteria for investment planning, and (e) permission to public enterprises to raise resources from the capital market to execute plans of diversification/expansion. The basic purpose of operational measures is to infuse the spirit of private enterprises so that government control is effectively reduced and private initiative is promoted.
Privatization in a narrow sense indicates transfer of ownership of a public sector undertaking to private sector, either wholly or partially. But in another sense, it implies the opening up of the private sector to areas which were hitherto reserved for the public sector. Such deliberate encouragement of investment to the private sector in the economy, while emphasizing to a lesser degree the expansion or growth of the public sector, will our a period of time increase the overall share of the private sector in the economy. This is the broader view in which privatization of the economy can be effected. The basic purpose is to limit the areas of the public sector and to extend the areas of private sector operation, including heavy industries and infrastructure.

Discuss different dimensions of privatization in brief.

2009-06-14T03:04:00.001-07:00

Discuss different dimensions of privatization in brief.

Privatisation
Privatisation. The term is essentially an umbrella head to encompass a number of distinct and perhaps alternative means to enhance the role of private sector. Analytically speaking there are basically three dominant ways of changing this relationship. They are:

i) Denationalisation: This involves changing the ownership of public sector assets to private sector. This may be partial or full so that some activities of the former enterprise may be hived off or some or even the whole of the company’s equity may be sold;
ii) Liberalization of deregulation: This is essentially opening up of area which were hitherto reserved exclusively for the public sector or in other words the introduction of competition into statutory monopolies; and
iii) Contracting out; This involves franchising to private firms the production of goods and services which are under the financial control of the government.

In practice, more often than not much of the discussion on privatization has come to be narrowly equated with the sale of industrial assets owned by the government to the private sector.

Privatisation is thought of as a means of resolving the difficulties of relations between government and nationalized industries; and

In also reduces the power of public sector unions, leading to increased efficiency in the use of labour and less pressure towards wage inflation.

The concern for improving public enterprise performance I the country has been increasing especially in the 180s. This concern had its underpinnings in the increased role placed on the public sector to generate adequate resources for the country’s five years plans. Secondly, in has been the ratio of net savings to investment in these enterprises as shown in Table 16.8.

The government has bee seized with the programmes to improve the performance of public sector enterprises. Singing of Memorandum of Understanding (MOU), formation of holding companies are instances in this direction. But instances of Privatisation through sale of industrial assets have been very rare in the Indian case. There is just one instance, namely the sale of one public enterprise under the ownership of Andhra Pradesh State (Allwyn Nissan) to the private sector (Mahindra & Mahindra). However there are several instances of liberalisation and deregulation. Opening up of areas which were hitherto the exclusive monopoly of the state, viz., the manufacture of certain kinds of telecommunications equipment, the private air taxi services, are pertinent examples

There is of course no formal policy towards privatisation in the country. This is primarily so because it is not politically palatable and secondly because the private enterprise in the country depends to a large extent on financial resources from the public sector financial institutions. Successive governments have shield from clearly articulating on this subject.

Briefly discuss the characteristic features of ‘collective bargaining’ and its extent and scope.

2009-06-14T02:33:00.000-07:00

Briefly discuss the characteristic features of ‘collective bargaining’ and its extent and scope.

For long several commissions and commissions debated reforms to industrial relations seeking to amend trade union act to make registration requirements relatively more stringent than at present (from any 7 being able to form a union proposed to be revised to 100 or 10% of the employees), provide for statutory mechanism for recognition, deny industrial relations to unregistered/minority unions, and specify more clearly not only trade union rights, but also trade union obligations/responsibilities. The Dispute Act is also proposed to be amended to provide for more emphasis on relations than disputes and set up an independent Industrial Relations Commission in the place of existing dispute resolving machinery. Proposals have also been made to consider constitution-negotiating councils where there is more than one union.

The central law, Trade Unions Act, 1926 provides for trade union registration, not trade union recognition. By convention, all registered unions have begun to have industrial relations rights, de facto, though not de jure. With the law permitting any seven employees being able to form and register a union, the ground was open for a variety of craft, category, caste, etc., based unions. Labour being a concurrent subject, certain state governments (like Maharashtra, Gujarat and Madhya Pradesh) have passed separate legislations provided mandatory mechanism for trade union recognition. Certain states like Andhra Pradesh made secret ballot a must. But statutory provisions concerning union recognition did not, unfortunately, ease conflict on this count. The biggest strike in post-independence India occurred in the Bombay Textile Industry in 1982 over the issue of, primarily, representative character of two rival unions. A variety of methods are available for determining the representative union. It can be done through any of the following methods: secret ballot, check-off of membership verification. Union shop method is not prevalent in India. However, selection of representative union for recognition as collective bargaining agent which is necessary to engage in collective bargaining has itself become a major problem because different national federations of trade unions did not agree to a common methods and left the problem for settlement according to location realities! Even the National Labour Commission has left it vaguely. Proposals to alter the situation, along with other major changes in the Trade Unions Act have become abortive since 1978.

In India, the role of national federations of trade unions and employers’ organisations is limited, in collective bargaining, to a small nucleus of industrial associations which have a long tradition of collective negotiations with their counterpart trade union federations of workers. Among such employer associations, notable mention may be made of the Ahmedabad Mill Owners’ Association, Ahmedabad, the Bombay Mill Owners’ Association, Bombay, the Indian Sugar Mills Association, New Delhi, the Tea Association of India, Calcutta, the Indian Jute Mills Association, Calcutta, the Cement Manufacturers’ Association, New Delhi, the United Planters Association of South India, coonoor, the Southern India Mill Owners’ Association, Coimbatore, the Indian Banks Association, Bombay and the Indian Port Association, New Delhi. The confederation of Indian Industry, which till last year (1991) represented mainly the engineering Industry, which negotiating region-cum-industry agreements for member firms who assigned to them in writing such responsibility.

“The role of industry associations in collective bargaining seem to vary depending upon the profile and background of industry and entrepreneurship. In a traditional, the engineering industry, profession managers are the charge of variations in processes and outcomes are discernible in each case which merit detailed study.”

In some Industrial centres, both trade unions and employers, particularly have set up coordination committees to adopt a joint/collective strategy to deal with collective bargaining and related matters. This process has started in Bangalore and Hyderabad and spread to other places. Industry wise coordination is also taking place with the commencement of industry wide agreements in core sectors like coal and steel. Oil industry, all of which is in public sector now, also has a coordination committee though it does not have an industry wide agreement.

For public employees, Joint Consultative Machinery and Board of Arbitration have been constituted. Public pay is revised through pay commissions which are usually adopted once every 12 years or so. The significant gap between central government pay systems and industrial pay systems created considerable heartburn and discontent to those who feel they were adversely affected particularly in the wake of some Supreme Court judgments pronouncing public sector as the State.

In a few industries such as cement arbitration has replaced collective bargaining over wages and working conditions while in others like media (newspapers) and sugar wage boards still decide the wages and working conditions. In all other cases, with all its distortions, collective bargaining is the main mechanism through which wages and working conditions are decided. Over the years, the scope of collective bargaining has been widened to include virtually every possible aspect of working relation including the quantum of overtime, shift manning, discipline promotions and transfers, for instance.

An industrial society is highly complex and dynamic arrangement of differentiated groups, activities and institutional relationships intertwined with a variety of attitudes ad expectations. Consequently, any specific social phenomenon, such as industrial relations, cannot and should not be viewed in isolation from its wider context. The ‘context’ of industrial relations may usefully be divided into three major elements (See Figure).

• The Industrial Relations ‘System’. The roles, relationships, institutions, processes and activities which comprise the phenomena of industrial relations exist both in a wide variety of industries and services and at a number of levels ranging from the suborganisational (work group, section or department) and organisational (site or company) levels through the industry level to the national level. This inevitably creates a pattern of internal influences both horizontally (between different organisations/industries) and vertically (between different levels). Consequently, the industrial relations system, in terms of the attitudes and activities existing within it at any point of time, provides its down context or climate for the indivedual industrial relations situations.

• Other Segments of Social Activity. Industrial relations is only one segment of a society’s structure and activity and as such is influenced by, and in turn influences, other segments of the society’s activity. The economic, social and political segments are of particular importance in this respect. Actions or changes in these areas may directly stimulate or constrain specific industrial relations activities as well as indirectly influence the attitudes of the participants. It is important to recognise that these environments exert an influence at all levels of industrial relations and therefore, as Fox argues, “organisational issues, conflicts and values are inextricably bound up with those of society at large”.

• Time. The present is only part of a continuum between the past and the future; consequently, current industrial relations owes much to its past (whether last week, last year, the last decade or even the last century) and the participant’s goals and expectations for the future. At the micro level, the time context may be evidenced in two ways: (a) today’s problem stems from yesterday’s decision and its solution will, as the environment change, become a problem in the future, and (b) the attitudes, expectations and relationships manifest by the participants are, at least in part, the product of their past individual and collective experiences. At the macro level, industrial relations as a whole is subject to adjustment and development as society, expressed through changes in the economic, social and political environments, it change and develop.

At the same time it is important to recognise that the ‘mass media’ provide an additional, and very significant, context for industrial relations by virtue of their role in shaping attitudes, opinions and expectations. Any individual, whether as a manager, trade unionist or part of the ‘general public’, has only a partial direct experience of the full range of activities present in a society. Most knowledge and appreciation of economic, social, politcal and industrial relations affairs is, therefore, gained indirectly from the facts and opinions disseminated through newspapers and television.

APPROACHES TO INSUSTRIAL RELATIONS
The term ‘industrial relations’ is used to denote a specialist area of organizational management and study which is concerned with a particular set of phenomena associated with regulating the human activity of employment. It, is however, difficult to define the boundaries of this set of phenomena, and therefore the term itself, in a precise and universally accepted way. Any more specific definition must, of necessity, assume and emphasize a particular view of the nature and purpose of industrial relations – consequently, there are as many definitions as there are writers on industrial relations. For example, the two most frequently used terms of ‘industrial relations’ and ‘employee relations’ are, in most practical senses, interchangeable; yet they have very different connotations. The former, more traditional, term reflects the original historical base of unionized manual workers within the manufacturing sector of the economy whilst the latter has come into greater use with the development of less unionised white collar employment and the service and commercial sectors of the economy.

The term may be used in a very restrictive sense to include only the formal collective relationships between management and employees (through the medium of trade unions) or in an all inclusive sense to encompass all relationships associated with employment (those between individuals at the informal level as well as those of a formal collective or organisational nature).
However, it is doubtful whether the two approaches can, or should, be separated so easily-informal, interpersonal or group relationships are influenced by the formal collective relationships which exist within the industrial relations system and, it may be argued, the formal collective relationships are themselves in part determined by the nature of individual relationships within organisations cannot provide a natural boundary for the subject matter of industrial relations.

The way we perceive the overall nature of this area of organisational study determines to a very large extent not only how we approach and analyse specific issues and situations within industrial relations but also how we expect others to behave, how we respond to their actual behaviour and the means we adopt to influence or modify their behaviour. In examining the different approaches it is useful to differentiate between those approaches which are concerned with the industrial relations system itself.

However, it is important to bear in mind that:
i) They are primarily analytical categorisations rather than causative theories or predictive models, and
ii) There is no one ‘right’ approach; rather each approach empasises a particular aspect of industrial relations and taken together can provide a framework for analysing and understanding the diversity and complexity of industrial relations, i.e the complexity of the human aspect of work organisations.

Discuss the different approaches to social responsibility.

2009-06-14T02:25:00.001-07:00

Discuss the different approaches to social responsibility. Express your opinion regarding these approaches in the present context.

The case of an R.K.Syntex is a company that has strongly diversified into a sequence of various linked areas. From a feedback of textile R.K entered the field of syntax fibers and successfully moved into a several different syntax fibers is dependent on related technology. For the year 1980’s the turn over of sales of rupees 40 million included 30% from polyester filament 17% from polyester staple, fiber, 10% from nylon, tier code, 15.5%. The various different synthetic fibers accounted for 70% of the total turnover, while the rest came from (cement 20% and other products 4.5%).
The strategy of diversification of the firm is such that there is a ‘similar thread’ which relates the past, present and future goods and product and market, the insiders can easily know the future developments of the organisation, and the outsiders can gauge where the company is going.
Kivirist: Yes, it is easier to enter the world of self-employment based on your existing skills and contacts (I call these “dreamfunders” in Kiss off). But do remember that your existing “skills” from the corporate world may be more universal and applicable than you may think. For example, in my corporate years I worked in an advertising agency. I didn’t freelance in advertising specifically when I became self-employed, but rather applied the skill set I had developed there (i.e., marketing, account/ client management, presentation skills, etc.) in fields I was more interested in.
Profiting from Righteousness: For a snapshot of how corporate social responsibility boosts an enterprise’s over all performance, one only has to look at British Telecom (BT). The mammoth telecommunications provider, which boasts annual sales of more than $30 billion, has been active in the field since the late 1980s. At first, only philanthropy and environmental management concerns were on its agenda. But after fully developing expertise in those areas, the company expanded into other fields as well, including community development through training and technology.
BT has become a model of how a company can work to assist disadvantaged communities and inspire its staff to be social stewards. The company gives 1% of corporate profits directly to communities each year, which is largely invested in education. Money goes toward teacher training, in-school workshops, and the transfer of digital technology. Employees are also encouraged to give to charity. British Telecom has a charitable matching plan for workers who want to participate. It matches employee contributions to charity up to $1.6 million. Over the past ten years the company has been tracking the business case for corporate social responsibility by surveying its customers around the world. Its findings are startling: “Our studies show there is a direct link with our progress in corporate social responsibility, customer satisfaction, and brand reputation, “reveals Adrian Hanford, director of Bt’s social policy in London. “ About one-third of our corporate reputation is driven by our socially responsible endeavors.” As he points our, that’s a huge impact.
British Telecom experience demonstrates a hard truth: Like it or not, every action a corp.-oration takes may be interpreted as a statement of what it stands for. That’s why a principled company will fortify its reputation. Research proves this point. According too corporate.

Critically analyze the impact of economic reforms on PE s with special emphasis on atomic energy and railways.

2009-06-14T02:23:00.000-07:00

Critically analyze the impact of economic reforms on PE s with special emphasis on atomic energy and railways.

The Industrial Policy Statement of 1991 is a marked shift in PE policy. Even in a few areas reserved for PE, private capital is being allowed. The policy change is due to inadequacy of PE to perform effectively. The policy statement provides a detailed prescription to the situation, but has failed to do so because of its ineffective implementation. Promises and suggestions made in earlier policy statement and in seventh plan document also remain unattended. This has adversely affected the PE performance. PE have gone out of esteem not only in India but the world over, but the private sector can not be their substitute unless it is closely monitored and effectively regulated.

CHANGE IN PE POLICY: JULY 1919 POLICY STATEMENT

The Industrial Policy Statement of the Narasimha Rao government totally reversed the PE policy. Though the statement began with a reverential reference to Pandit Nehru and his contribution and philosophy, it was a clean break from the policy of the socialist pattern. In the words of the VIII plan (1992-97) document, the policy now was of “managing the transition from centrally planned economy to market led economy” The policy aim has been to “roll back” the public sector investment from those sector of the economy where the private sector could move in.

Ridiculing the hypocrisy of the Congress leadership that the Nehruvain module of the economy was intact, Mr. Yaswant Sinha, a former finance minister remarked: “Having turned down the Nehruvian module upside down the Congress party is now trying to stand on its head to prove that it has not departed from the module”. The fact is that the Congress leadership has clinged to Nehru’s name as it did not have adequate congress to have break from the traditional congress idiom. In this regard, it would be of interest to refer to the first Para of the policy statement of 1991, which is reproduced below.

“Pandit Jawaharlal Nehru laid the foundation of modern India. His vision and determination have left a lasting impression on every facet of national endeavor since Independence. It is due to his initiative that India now has a strong and diversified industrial base and in a major industrial nation of the world. The goals and objectives set out for the nation by Pandit Nehru on the eve of Independence, namely, the repaid agriculture and industrial development of our country, repaid expansion of opportunities for gainful employment, progressive self-reliance remain as valid today as the time Pandit Nehru first set them out before the nation.

Any industrial policy must contribute to the realization of these goals and objectives at an accelerated pace. The present statement of industrial policy is inspired by these very concerns, and represents a renewed initiative towards consolidating the gains of national reconstruction at this crucial stage”.

Reasons for Change in Policy

As noted in the policy statement, the government felt that “after the initial exuberance of the public sector entering new areas of industrial and technical competence, a number of problems have begun to manifest themselves”.

Six of these listed in the statement were:

(i) Insufficient growth in productivity,
(ii) Poor project management,
(iii) Over managing (which means employing more persons than necessary for performing a job),
(iv) lack of continuous technological upgration,
(v) Inadequate attention to R & D and human resource development,
(vi) A very low rate of return on the capital employed. According to the policy statement, all these resulted in many PEs becoming “a burden rather than to the government”.

The fact of the matter as that government itself has been responsible for poor management of PEs were never provided adequate autonomy to perform, and an effective and professional board of directors. PEs also lacked a sense of direction the absence of an unambiguous set of mission and objective. Decisions were taken to serve a vague and varying ‘public interest’, ignoring the impact on commercial performance and morale of PE manger.