Chief executives of private firms will be able to join PSU boards as independent

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directors if the proposal of the Department of Public Enterprises is accepted by the Department of Personnel and Training .

At present, only retired CEOs of the private sector are allowed as independent directors (IDs) on the PSU boards.

"We have suggested to the DoPT that serving CEOs in private companies should also be made eligible for the appointment of independent directors in state-owned companies," DPE Secretary Bhaskar Chatterjee told PTI.

He said that since there is no retirement age in private sector, the PSUs are not able to take advantage of the experience of the corporate heads in the non-official capacity.

According to a CAG report, of the 47 listed government companies, majority of them do not have the required number of IDs.

With the regulator making it mandatory for PSUs to have adequate number of independent directors for tapping the stock market, the DPE wants to meet the shortage of non-official directors in PSUs and expedite the appointment process.

As per the SEBI guidelines and a listing requirement, a company should have on its board 50 per cent representation by independent directors, if it has an Executive Chairman.

In case the chairman is non-executive, the rules demand that at least one-third of the board should comprise independent directors.

There are 246 Central Public Sector Enterprises in the country, as on March 2009.