The full board of Satyam Computers meets today--June 11-- for the first time, after the bizarre and shame making events that besmirched the company's reputation six months ago. It will include the government nominees who helped run the business in recent weeks, restoring painful inch by inch its professional reputation and -- in large measure -- the confidence of its clients and investors.
' Our job is done' Corporate Affairs Minister Salman Khursheed said yesterday -- and added that the government nominees --Kiran Karnik, Deepak Parekh and C Achuthan as well as Tarun Das and TM Manoharan-- are now ready to step down leaving Tech Mahindra, the company that has taken over Satyam after an open and transparent process, to put in place its own leadership team.
Good governance will tell -- even in the short term: In the last few days, Satyam, astonished the market when its shares hit over Rs 73 -- well above the Rs 58 price at which it was valued for the Tech Mahindra takeover. The markets were responding to the news that Satyam had booked a profit of 1.6 billion rupees during the quarter ending December 2008 -- modest, but a clear signal that it was once more ' business as usual' . Our photo atop this item is strangely ironical. "Count on us to transform the game of business" reads the hoarding at Bangalore International airport -- celebrating Satyam's selection as lead IT provider for the 2010 FIFA Cup in South Africa. They did transform the game of business in ways no one ever expected -- but thanks to the resilience of the Indian IT brand and the Indian government's firm and professional intervention, the game has transformed again and Satyam is back in play.
Let us take a minute to recognise how this happened.
The Indian outsourced services business including all of Satyam's competitors, behaved with maturity in the face of Satyam's adversity. They did not poach for Satyam's known talent, nor try to grab its business in an aggressive way. The government on its part, tapped the top talents of Enterprise India when it came to selecting Satytam's transition management -- instead of succumbing to its normal instincts of packing babus into the board.
The result? India has shown the world that it is a mature economy, operating within the frame work of a democratic government and a free market. It is not immune - who is, these days -- to the actions of individual rogue traders and business people. But it has the self confidence and the systemic checks to correct itself and move forward. There have been no mass sackings at Satyam. The work force – we always knew they were great techie guys – remained loyal; and now their loyalty has been vindicated – as has the confidence of those Satyam clients who did not cut and run.
There is yet, work to be done. Tech Mahindra will have its own ideas and game plans for its acquisition. It must be allowed the rescuer's privilege of putting them into place.
The country’s legal system must act without delay and bring to swift and fair closure, the process of identifying the guilty. And if initial zeal has seen the the law enforcement agencies sequestering any who are not directly culpable, they must be restored their freedom without a day’s delay. Putting external auditors behind bars seems at first glance, to be something of an over reaction and unless government has a clear case that the individuals actively colluded with Satyam, it would be unjust to include them in the net of those alleged to be have perpetrated the fraud. Indian corporate governance has delivered a swift conclusion to the task of getting Satyam back on rails. Indian jurisprudence can do no less.
So on a day when it becomes the 999,999th word of the English language, let us flog it, for the last time we promise, and say Jai Ho! to the Second Coming of Satyam.
- Anand Parthasarathy