Wednesday, January 15, 2014

REGULATORY BODIES : Need for Professionalism

The recent Kelkar Committee Report on Hydro Carbon Regulators have highlighted the absence of financial regulatory expertise in the regulatory framework. The Report has given rise to a new debate about composition of all the regulators to ensure that they are efficient, effective, practically strong and judicially independent. A significant part of the government decision making process and administrative and policy control have shifted to various regulators including RBI, SEBI, Competition Commission of India (CCI), Telecom Regulatory Authority of India (TRAI), Central Electricity Regulatory Commission (CERC) including State level Electricity Regulatory Authorities, IRDA , DGHC etc.

The various regulators have played a very significant role in creating a congenial Development and regulatory atmosphere in their respective areas. However, there are number of issues which are required to be handled professionally and can be given a right direction to ensure achievement of all major objectives within the regulatory framework. The various regulatory bodies require significant input in accounting and financial aspects, legal and judicial aspects, technical and managerial expertise in the respective disciplines.

Most of the existing regulators consist of senior and / or retired bureaucrats at top levels. It is important to have adequate representation of young energetic qualified professionals in the respective technical areas, financial and accounting disciplines, managerial discipline as well as legal and judicial disciplines with an average age group of 45 to 55 years on the regulatory bodies at top most level to be selected in a balanced and transparent manner. The regulatory bodies can have adequate representation of all stake holders including investors and consumers on their advisory committees.
The various professionals participating in the regulatory process need to give adequate respect and recognition to expertise and experience of each other so that decisions are taken in the national interest and most importantly in the interest of development of the respective areas. The profession of Chartered accountants, Cost accountants, Lawyers, Company Secretaries, Engineers, Scientists and MBAs need to be given an opportunity to serve on regulatory bodies. The regulatory guidelines and framework so designed should be subject to review by legislature and judiciary with an appropriate framework to address stakeholders’ concern in an open transparent manner. Excessive placement of bureaucrats in regulatory bodies may defeat the very purpose of creation of such bodies. These are mandated to regulate & develop not control & unnecessary compliance's, procedures, penalties and prosecutions, which a large cross section of the Indian bureaucracy enjoys.

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