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Satyamev Jayate

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DQI Bureau
New Update

Like for many others it is astounding for me that something of this magnitude

went undetected and nobody blew the whistle earlier. And that includes insiders,

outsiders, company watchers, analysts, banks, auditors and media (including this

publication). But is that not true of all financial scandals? ( have a look at

http://projects.exeter.ac.uk/RDavies/arian/scandals/ ). The human capacity to

deceive and be deceived is truly remarkable.

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If scams and scandals still persist there have to be more reasons than mere

greed. And there are many.

First is that the risk reward ratio, especially in the present day, is

skewed. The financial, power and recognition related rewards are

disproportionate in a winner takes all world. And therefore the need to be, and

remain a winner, increases in direct proportion. Yes, there is an occasional

derailment, a few get caught and are tried first by the media and then by

judicial bodies. Some of them even get punished. But there are too many others

who are not caught. Surely chief executives, presidents, chairmen, and

politicians are not so nave that they are not aware of the risks. But in their

opinion the risk is worthwhile.

Shyam Malhotra

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Then there is the relentless pressure. Whatever else in Rajus confession,

this is real. Ask any leader. The tiger of success and growth is difficult to

mount. It is even more difficult to get off. So they keep riding it from quarter

to quarterwith the hope that things will change. As long as growth remains, it

works. When it stops, the tiger has its fill. So please expect some reruns of

this story with new characters. Andjust to clarifyI have no information about

other Indian companies riding their own tigers.

The script also has many accomplices and cheerleaderswho wittingly or

unwittingly spur the process. Inside the organization there are the silent

acceptors whose careers and/or wealth plans depend on share prices. They have

their own tigers to ride. Outside the company there are those who applaud and

awardwith fake enthusiasmevery step. In each case there is self interest that

turns truth to a casualty. In fact, most times truth is taken at face value and

accepted norms and principles.

There is also the issue of those who judge the wrong-doers. In many cases

these are politicians or bureaucrats. The politicians have their own scams. If

lying to shareholders is bad, lying to the electorate is worse. And politicians

do it with far greater regularity and intensity then corporate leaders. But for

some reason the yardstick for lies, corruption and cheating is different for the

political class. Now Mr Rajuand many others like him with a criminal recordis

not suitable for even a class four job in the Government of India. He can, of

course, become a minister. Bureaucrats have their own axe to grind or their

backs to protect, and do not interfere until inevitable. In this case Maytasthe

infrastructure companywhich is a probable cause of the problem, has received

many large contracts. It would not be unrealistic to imagine political and

bureaucratic involvement. The banks and auditors also have congruent business

interests. And that increases their chances of collusion at the individual or

organizational level.

So even as this story unravels it would be good to remember that these tigers

will not get extinct so easily.

Satyamev Jayate!

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