Many have raised questions if Satyam scandal is a solitary case of unscrupulous corporate governance in India. I, for one, will like to answer with a big NO. Promoters or the MDs who are generally one of the promoters or from the family of promoters find ways and means to make money by means that may be called unscrupulous means. Most of the small and big companies, particularly manufacturing units generate scraps and waste that are sold in a way that is always suspicious. Mostly, the person responsible is one of the very confidential persons of the top men. I doubt if the auditing can take into account these practices. Purchasing of the general supplies and components constitutes another area that is susceptible for all sorts of corruption. Similar unscrupulous practices may find place in buying capital equipment and machinery. In most of the case, the beneficiaries of all these corrupt practices are the men at the top.
However, there are many interesting aspects of this scandal that require serious in-depth research. Why and when Raju’s mental faculty switched over from building Satyam as a globally top ranking IT service company to siphoning Satyam’s money to personal properties? Did he change on his own or he got induced to do that after some amount of convincing from some near and dear ones from inside the family or some ones from outsides?
40,000 employees worked with Satyam, when the official rolls showed more than 53,000. The inflated numbers made Raju richer by Rs 20 crore a month. Raju diverted Rs 74 billion (Rs 7,400 crore/$1.48 billion) from Satyam for personal wealth for which according to his own confession he cooked the figures in balance sheets year after year. According to a media report, Raju’s total remuneration as the Chairman of Satyam Computer Services Ltd was lower than that of the chief executives and chairmen of the other top four Indian IT services companies. Why would have Raju bothered if he was managing it through ghost payrolls? With the practice of huge lot of temporary workers getting popular in industry, the chances of manipulating the number of men employed and paid become pretty easy as well as difficult to detect. How can any say that the other companies have not been involved in malpractices that are being detected in Satyam scam? Doesn’t it remind us of the cooked muster rolls in NREGS?
According to the state revenue department, the Maytas groups, Satyam and Ramalinga Raju and his family members, all put together bought an estimiated 3,000 acres alone in Ranga Reddy district. I think, inflating land requirement, acquisitions and even grabbing has been pretty prevalent with most of the business houses. Many old companies such as those in textile and jute sector have made a lot of money even after closures through the land sales. Most of these deals have a portion that never comes in open. Big business houses kept on procuring and owning land in different parts of the country in name of some or the other projects.
Infosys chairman Nandan Nilekani considers the Satyam fiasco as a blessing in disguise, as it will make authorities enforce better regulations and auditing mechanisms for the industry. I wish it happens. But basically it is an aspect of business ethics and it depends on the moral values of the people of the country. But I and many were wrongly surprised and shocked to know what Raju did under the intoxicating greed. Unfortunately, most of us talk against greed but we hardly control it when we get opportunity to test our susceptibility for greed.