Satyam Computers' Corporate Governance Fiasco (H): One Year After
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Code : GOV0045
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Region : India |
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The Infamous Confession The Maytas deal was an attempt by Raju, to replace the fictitious assets of Satyam with the real ones of Maytas Infra. What began as a marginal manipulation of accounts, over a period of time had grown to a size that could not be hidden further. The announcement of the Maytas deal raised questions and doubts in the minds of the stakeholders leading to negative reaction and eventually aborting the deal... The Transition TechM’s 51% stake was welcomed by the director general of CII, Chandrajit Baneerjee and head of the government-appointed board Kiran Karnik. In an interview to a news channel, Karnik had expressed, “This is the culmination of what we have been through. The final steps are now just about to be taken and I am very happy that at this stage Satyam is with a new investor... The Restructuring There were serious issues that had to be addressed by TechM immediately after the acquisition. Due to the uncertainty that prevailed after Raju’s confession, many middle management managers and about 125 potential customers exited Satyam. TechM’s first priority was to control attrition of both employees and customers. There was an urgent need to create trust and confidence among employees and customers in the new management... |
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Satyam Saga: Lessons for India Inc. The Satyam saga has exposed shortfalls of India Inc. and its regulatory bodies. The business press criticised the soft approach adopted by Corporate Affairs Ministry towards family run businesses. It has questioned the existence and the role played by IDs and auditors’ association with the company. Satyam being a family run business, had appointed IDs closely associated to the promoters, while the auditors were never changed for over 5 years...
