Lesson for Democracy….

Who said the scourge of corruption is rampant only in public sector and mostly amongst politicians? Here’s is a case in the corporate world that shocked thousands of investors in the capital market. Satyam Computer Services Ltd , fourth largest software services company promoted by B.Ramalinga Raju, is said to have breached the trust of its investors by making a decision to invest whooping amount of Rs.6000 crores in a company in which the promoter and his family members jointly own a major stake. This is much like taking a huge sum kept under public trust and enriching the pockets of the promoters and his kith and kin. The Board of Directors of the company approved the investment decision without considering other available options. One wonders if this had been done with best of intentions. No matter how sound the decision is this was a big blow to the investor’s confidence.

Here I would like to draw to attention to the reaction that it kicked amidst investors and the analysts. Just after the controversial decision was approved by the Board and made public the investors of American Depositary Receipts (ADRs) floated by the company in USA smelt the smoke in the air,. The prices of ADRs dropped owing to this very reason. Back home in India investor did not react very sharply though. But analysts and experts were outraged and up in arms against the logic of the decision. A report by Mumbai’s Dolat Capital Market Pvt Ltd called this “Satyam’s Daylight robbery”. Following this the same mood was caught on like fire by investors. As a result the Management of the company had to revert its decision. This proves that shareholder activism is alive and kicking and nothing can go wrong in a vigilant society.

This further reinforced the need for transparency in the corporate affairs and strict measures of corporate governance. Here there is a lesson that needs to be learnt and it has to be deeply pondered over.

Have we ever seen such a quick reaction to any allegations of any scams and kickback cases involving government and politicians that has very much been in our daily newspapers? Or is the functioning of the government not transparent enough? Transparency, accountability and good governance is the philosophies of every country that believes in democracy and its deep rooted values. But these are hard to come by. Not unless people of our country raise their voice in unison against wrongdoings by the government of the day. And not unless government makes its day to day affairs transparent. And not unless people realize that the money spent by government is their money too and theirs only. What we need is Citizens Activism. Their rights as citizens do not terminate in the polling booths. In fact it is only a beginning. Only this beginning would be the true beginning of the rule of the people.