Big news today was Steve Jobs losing weight. Big Indian story this year was Satyam investing in Maytas. What binds these two stories together? Corporate governance. Oh yeah. Stock prices showed how 'One man can make a difference', though that one man was not Michael Knight of the Knight Rider. The Internet abounded with stories of Jobs being plagued with an unknown disease, perhaps even dying, since everyone was stumped at the precipitous loss of weight! So, to allay the fears and make everyone know that Jobs was not yet ready to quit his job, Mr Steve Jobs of Apple went on to sing 'Alright, Alright, everything's gonna be alright...' Well, he didn't really sing, but most i-pods generally do!
On the issue of corporate governance, one event that kinda tainted India's image in the world in terms of governance is the Satyam debacle. Why? Again, one man. One man decided to use funds of a listed public company to invest in his son's real estate enterprise. In other words, he wanted to run a family business using shareholders' money. The effect - snowballing scrutiny into corporate governance, and a 'Yikes, Indians can do this too????' question from foreign investors who look upon India as a key player in IT services. In a way the hullabaloo that followed the crappy decision of Mr Raju of Satyam bodes well for India, since it shows that the shareholder is still king, and that the company owner is in every way answerable to the millions of investors. Perhaps the democratic government can learn a thing or two about accountability from this model followed by corporate India.
On the one-man issue, we've seen a case where stock prices are dictated by one man. One man's well-being, or one man's folly. Look at Israel - Hamas. Soon after the head of Hamas was killed, the outfit went on to say that the struggle would endure, since leaders had been groomed along the echelons. Similar is the fear about all terrorist organizations. Just removing the head, does not decapitate the whole outfit. They grow another head much like a salamander or a starfish. Scary thought? Yes indeed. Although it is a practice followed for nefarious purposes, as a concept, perhaps corporate India and indeed the corporate world can think about corporate governance and leadership development along the lines of such a model. What say?
1 comment:
Not sure if the title should have been corporate governance or something related to over-reliance on a single person..
but interesting observation. I think whether it be Hamas or any other organization, no one is immune from a little suffering once it loses a patriarch. BJP without Atalji, Shiv Sena without Bala Saheb, India without Mahatma Gandhi... the trick lies in making the transition smooth and transparent to the world outside the organization.. to prevent panic and rumour-mongering during the transition phase.
best,
Vivek
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