Now Crisil, Icra to rate engineering, B-schools

Institutions will pay for the ratings, which will be based on parameters such as curriculum and placements
Prashant K. Nanda
    
New Delhi: In a country where engineering and business-school rankings are big business for media firms—in terms of circulation and advertising revenue—it was only going to be a matter of time before professional rating agencies got into the act.

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Crisil Ltd and Icra Ltd have started rating the programmes offered by business and engineering schools. While Crisil rates only business schools, Icra rates both. Crisil has graded 39 B-school programmes across 28 institutes, while Icra has rated 13 B-schools programmes.
“Since we are already into corporate debt rating, we explored another vertical,” said Rohit Inamdar, senior vice-president and co-head, corporate sector rating at Icra. “In three-four years we can have 30% of the addressable market,” he added.

India has at least 3,900 business schools and 4,000 engineering colleges. The ratings are certain to help students choose schools carefully, say analysts.

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Mint’s Prashant K. Nanda says professional rating agencies like Crisil and Icra are getting into the business of evaluating engineering and business schools


Around 1.5 million students enter engineering colleges across India every year and 350,000 go to business schools, but the quality of many of the institutions remains a suspect.

At least 138 professional colleges offering programmes in management, engineering and computer application streams have applied to the All India Council for Technical Education, the apex technical education regulator, for permission to shut shop, citing low admission rates and poor campus placement, Mint reported on 25 March.

Much like ratings of corporate financial instruments, the ratings of business and engineering schools are “solicited” but “independent and neutral”, Inamdar said. The agencies rate the programmes on parameters such as curriculum, infrastructure and placements. The schools pay for the ratings.

A Crisil spokesperson said in an email that such ratings add to a school’s credibility: “It provides stakeholders with reliable information about the school, increases their confidence in the school and helps the school acquire strong brand equity.”

Experts as well as the administrators of such schools say rating is a good idea. “There is no credible source of knowing which institute is good or bad. So going for independent ratings helps students, professors and parents while applying to colleges. Currently, we don’t have a structured system to tell whether JNU (Jawaharlal Nehru University) is better or Jamia Millia (Islamia),” said Narayanan Ramaswamy, partner and head of the education practice at audit firm KPMG. “What Crisil and Icra are doing is riding on their credibility. Unless they build competency, their credibility will suffer, (and) people will not trust (the ratings).”

The ratings that can be seen in newspapers and magazines and on TV are suspect because there is always the possibility of some quid pro quo, according to P.T. Joseph, director, Xavier Institute of Management, Bhubaneswar. Independent ratings are the way to go, he added. “When Crisil approached us, we told them that we would not pay them the first time and did not. But from next time onwards we will pay them. The rating brings transparency and helps students get a fair knowledge about the school and its offering.”

Parimal Merchant, admission-in-charge of SP Jain Institute of Management and Research, Mumbai, said Crisil doesn’t just rate its programme but also audits its placement report.

In the past, there has been some controversy over placement data released by business schools. Since the rating process is funded by the schools, neither Crisil nor Icra will publish them if the school disagrees with the rating.

Crisil rates B-schools in two categories, national and state-level, and between B (lowest) and A*** (highest). Icra rates business schools from Icra EB5 (lowest) to Icra EB1 (highest) and engineering schools from Icra EG5 to Icra EG1.

prashant.n@livemint.com

Editor; Sikkim should get its educational institutes rated from Crisil to enable it to improve the education quality and to raise educated children who can face the competition when they face life.