UTI constitutes Corporate Positioning Committee

In an attempt to ensure the country’s largest mutual fund, Unit Trust of India, is keeping with the times and is ready to face the challenges of the new century, the Board of Trustees of the fund, at a meeting convened to discuss the provisional results as of 30 June 2000, approved the formation of a "corporate positioning committee" to draw up a corporate plan for the fund.

The appointment comes in light of the rapid changes in the financial sector that have come about in the wake of globalisation, and the emergence of new technologies for efficient delivery of financial products and services. The board was of the view that, in this background, it was appropriate to have the benefit of assessment and advice from expert professionals on corporate positioning of UTI in the new millennium.

As a result of these deliberations, a seven-member committee headed by noted chartered accountant, Mr. Y. H. Malegam was constituted to go into the issues and recommend an appropriate repositioning plan to the board. The other members of this high profile committee include:

• Dr. Arvind Virmani, economic advisor, ministry of finance, government of India.

• Mr. R. P. Chitale, managing partner of M. P. Chitale & Co. a firm of chartered accountants and who is also a trustee of UTI.

• Mr. N. S. Sekhsaria, managing director, Gujarat Ambuja Cements Ltd. and also a trustee of UTI.

• Dr. J. Bhagwati, joint secretary, ministry of finance, government of India.

• Mr. Cyril Shroff, solicitor and partner of Amarchand & Mangaldas & Suresh A. Shroff & Co., a well known firm of solicitors.

Dr. Basudeb Sen, executive director of UTI has been appointed as the member – secretary of the committee.

The committee, which is to submit its report to the board in six months, has been given very specific terms of reference. These include:

• reviewing the competitive and commercial positioning of UTI in the light of the second generation reforms in the financial sector and emerging developments in the area of mutual fund business and globalisation of the Indian financial services sector.

• studying regulatory aspects the obligations of UTI under the UTI Act, including the implications of any change in the above context.

• studying the trend towards broader financial service companies.

• assessing confidence of investors in financial organisations of differing sizes and strengths

• evaluating the progress of implementation of the recommendations of the Deepak Parekh Committee.

The committee will deliberate on the above issues and recommend appropriate follow up action plans including amendments to connected legislation for enabling UTI to fully meet with the mutual fund regulations of Sebi. The board expects the committee’s recommendations to lead to an enhancement of the competitive positioning of UTI in the new business environment.

Commenting on the appointment of the committee, Dr Basudeb Sen, executive director of   Unit Trust of India said: "In the coming years, UTI has to enhance its competitive and commercial strength. At the same time, it has to fully conform to emerging regulatory framework. To set the right direction and course of action, the expert view of the committee will be of considerable help."