5 key reasons why IIM A, B, C, L prefer awarding diploma to degree despite implementation of IIM Act

Despite the IIM Act 2017 coming into force on Wednesday January 31, 2018, none of the top IIMs agree to award degree to its current 2016-18 batch. The 15 of the 20 IIMs advocate the award of diploma to the existing batch as they have been doing so far.

IIM Bill 2017 which was turned into an Act after  getting nod of the President of India Shri Ram Nath Kovind on December 31, 2017 may not bring its desired result for the current batch as the IIMs and the students studying in 2016-18 batch prefer the Post Graduate  Diploma instead of MBA degree.

Minister of HRD Shri Prakash Javadekar recently held a meeting with the chairpersons of IIMs to discuss many issues related to the rules that are being framed under the IIM Act which came into effect on January 31. It is learnt that it was clarified in the meeting that the IIMs who wish to issue MBA degrees instead of PGDMs to the current 2016-18 batch can do so without any constraint. However, most IIMs are in favour to award Post Graduate Diploma in Management (PGDM) instead of degree in the convocations going to be held in late March or April 2018.

IIMs & Students not in favour of MBA degree
A few reasons elaborated by IIMs and their students alike to go for the PGDMs instead of Degree are:

• The rules to grant degrees are yet to be framed. It is essential to have clear cut rules to satisfy procedural requirements before they award degrees. Till the rules are framed, IIMs prefer to award Post Graduate Diplomas (PGDMs) instead of degrees.
• A consensus among all the 20 IIMs is yet to be arrived at. Many IIMs prefer award of PGDMs even for future batches, a few others prefer MIMs and rest other ones want to award MBA degree. Accordingly, the final decision will be taken after arriving at the common view point on award of the degree/diploma.
• Many students at top IIMs want to be awarded PGDM diplomas instead of MBA degrees since they enrolled and took admission to pursue Post Graduate Diploma Programme in Management popularly known as PGP in IIM circle.
• IIMs have created a greater value for the PGP programmes and this value is considered much higher than many other MBA programmes across the world. Now it is a general perception that PGDM from IIM commands a higher market value than an MBA degree and due to this fact, students want to get diploma from an IIM than a degree.
• Minstry of HRD has therefore formed a committee headed by Shri Ajay Shriram, Chairperson, BoG, IIM Sirmaur to frame the rules in regard to award of degree by IIMs. The rules in their final shape are expected by the end of March 2018. 

MHRD asks IIMs to prepare 5 years Vision Plan
MHRD has asked the IIMs to prepare a 5 year action plan and strategy for the IIMs. Apart from it, MHRD has also sought an active participation of the IIMs in framing of rules. The IIM rules will also include the terms and conditions of service of the directors and the powers and duties of the board of governors among other key provisions.

As per the IIM Act 2017, IIM Board of Governors will comprise a chairperson, a central government nominee, one nominee of the state government of the particular state in which the IIM is situated, four eminent persons, two faculty members and maximum of five alumni.

All the 20 IIMs, as per the Ministry of HRD are now empowered under the IIM Act to award MBA degree to their students instead of PGP/PGDM diplomas which used to hamper prospects of global career opportunities and higher studies of their students as the distinction is made between globally acceptable MBA degree and post graduate diploma.

MHRD cannot appoint Director, Chairperson any more
Ministry of HRD, Government of India cannot appoint an IIM Director or Chairperson BoG any more as per the provisions of the IIM Act 2017. The Act  empowers  the board of governors of each IIM to appoint its own chairperson or director, moving away from the earlier procedure of forwarding the suggested names to the Minstry of HRD which could or could not agree with the suggested names or could appoint the person of its choice.

Under the IIM Act, the autonomy envisaged for IIMs exceeds the autonomy granted to other institutions of higher education such as IITs and AIIMS.  For example, Directors of IITs and AIIMS are appointed by the central government.  Introduction of new courses of study at AIIMS requires approval of the Medical Council of India but IIMs have the autonomy to do both the things internally.

IIM Bill 2017 was passed by Lok Sabha on February 9, 2017  and by Rajya Sabha on December 19, 2017 unanimously after being tabled by the Union HRD Minister Mr Prakash Javadekar. After getting the nod of President of India on December 31, the bill has now become IIM Act 2017 and has taken effect on Wednesday January 31, 2018.

The roll out of IIM Act 2017 has enabled the IIMs to award MBA degree and has also given them higher autonomy so that they can seek international alliances and expand their role further in global industry connect for their existing and future batches.   

For the last few years, IIM Bill was under consideration and lot of debate & discussion on it in the IIM circles and at the MHRD level had been going on over the various provisions of the bill. With the assent by the President, now IIM Act 2017 has paved the way to fulfil the long cherished dream of IIM passing out students to get MBA as all the IIMs would be vested with the statutory powers to award degrees instead of diplomas.

IIM Act 2017  declares 20 existing Indian Institutes of Management (IIMs) as institutions of national importance and confers on them the power to grant degrees. IIM Act 2017 empowers the IIMs to establish their campuses abroad and make their presence felt globally as IIM Ahmedabad is expected to establish its learning centre in Dubai shortly.

Stay tuned to MBAUniverse.com for more updates on IIM Act 2017 and its impact on IIMs

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