Saturday, April 14, 2018

Water crisis

A company was starved of water. It sought the help of a consultancy firm to solve its problem.

The firm had four eminent partners. They were respectively a chemist, an environmentalist, a mythologist and a top official of a large bank. The bank's rules did not permit its employees to carry on private business. But the top management of the bank believed in the policy of 'live and let live'. So everything was kosher.

The firm was known for offering four solutions to every problem though it charged for only one. The banker called it 'value for money'. After extensive study, the chemist advised the company to buy hydrogen and oxygen cylinders and mix the gases 2:1 and get water. The environmentalist noticed that there was some vacant land in the company's backyard and suggested afforestation which would provide copious rains in future. The mythologist advocated conduct of 'Varuna japa' to propitiate the rain God.

The banker wrote in his recommendation: "No action is called for. The crisis shall pass."

None of them suggested that the arrears of water tax be paid so that the municipality would restore water supply.

Friday, April 13, 2018

"Chanda Kochhar is not guilty"

I am now convinced that Chanda Kochhar is not guilty of any misdemeanour. We have been barking up the wrong tree for quite some time. Here is why.

Figures speak louder than words. Similarly, statements speak louder than actions. So, I go by statements.
You may remember the three unforgettable statements of the recent past:

1) ICICI: The brother of one's spouse is not a relative according to The Companies Act for the purposes of related party transactions.

2) Deepak Kochhar: I did not inform my wife my business relationship with Venugopal Dhoot.

3) Venugopal Dhoot: When ICICI sanctioned loans to Videocon, I was not aware that Chanda Kochhar was associated with ICICI Bank.

If these statements do not convince you of Chanda Kochhar's innocence, you may want to question her yourself. What would be her reply to you?

Q: Are you aware of Rajiv Kochhar benefitting from your bank's clients?

A: Who is Rajiv Kochhar? I don't know anything about him.

Q: When did your husband tell you about his business deals with the promoter of Videocon?

A: My husband never told me anything about this. In fact, we do not speak to each other. We are a deaf-mute couple.

Q: Did you personally know Venugopal Dhoot when your bank sanctioned loans to his group?

A: Who is Venugopal Dhoot? When I studied the loan papers of Videocon group, I looked at the names of companies only. I was not distracted by irrelevant information like who was the promoter. We are a focused bank.

You may think these are imaginary. Yes, they are. If you really ask Chanda Kochhar these questions, you may get even more surprising answers. If she speaks, that is.

Wednesday, April 11, 2018

Chanda Kochhar: Flattered only to deceive?

Nobody expected Padma Bhushan Chanda Kochhar to place herself in a situation reeking of quid pro quo, nepotism and conflict of interest all in one. M.Damodaran, formerly of SEBI, was at his sarcastic best when he told an interviewer yesterday (Tuesday, April 10) that he never thought the Padma Bhushan Bank would descend to such depths of depravity. He calls ICICI Bank as the Padma Bhushan Bank for it produced the Padma Bhushan Trimurti, namely K.V.Kamath, N.Vaghul and Chanda Kochhar. He added poignancy to his observation by reminding that Ramesh Gelli, the creator and destroyer of Global Trust Bank had been awarded Padma Shri.

It is now reported that ICICI Bank is waiting for a direction from the regulator, RBI before deciding on the tenability of Chanda Kochhar continuing in office. Coming from ICICI Bank, this is a bit rich because this bank is not shy of violating RBI guidelines on various matters and has been penalised by RBI on several occasions. It is not clear why Chanda Kochhar does not realise that it is better to quit with whatever respect is left than to get the sack from RBI. It is a race to the bottom between ICICI Board and its MD.

M.K.Sharma, Chairman of ICICI Bank and N.Vaghul, a former chairman have sullied their reputation by rushing to pronounce that Chanda Kochhar is innocent. Chanda Kochhar herself has maintained a disturbing silence. Her husband has claimed that she is not aware of his business relationship with Venugopal Dhoot. If this is indeed true, it is too dangerous to have such a non-involved person as CEO of the bank. There ought to be a limit to spinning stories.

Shikha Sharma has acted with greater celerity in opting out of CEOship ahead of planned schedule. She has not allowed herself to become a butt of Governance jokes. Shikha's response has been welcomed, among others, by the stock market.

Chanda Kochhar's departure from ethical behaviour sets a bad example to thousands of bankers who held her in high esteem. She has miserably failed the Bagavad Gita test which says,

"Whatever action is performed by a great man, common men follow in his footsteps. And whatever standards he sets by exemplary acts, all the world pursues. (3:21) ( as translated by Srila Prabhupada)"

"Whatever a great man or woman does, others also do. Eminent people must in the public interest put forth their best virtues. Then ordinary people try to rise to that level." (Jack Hawley's translation.)

It will be in the fitness of things if the Padma Bhushan awarded to Chanda Kochhar is withdrawn and if the whistle-blower Arvind Gupta is suitably recognised.

Saturday, April 07, 2018

Disappointing discussion

It was disappointments galore at the Music Academy on Saturday (April 7) evening. What was promised to be a lively discussion on "New Ideas for a New India" turned out to be a drudging discussion on old ideas without any focus.

It was disappointing that Rajeev Chandrashekhar, an outstanding parliamentarian, could not turn up for participation. This meant that only three speakers, Bibek Debroy, Madhu Purnima Kishwar and S.Gurumurthy, would be in the panel moderated by N.Ravi. All panelists are eminent speakers and the audience was looking forward to seminal output from each of them.

Coffee that was offered before the discussion started was of poor quality. Though I normally avoid coffee on such occasions, in my excitement expecting a feast for the ears, I drank what was on offer. I was however confident that the quality of discussion would more than make up for the tasteless coffee. As the discussion started sinking in, I realised that the quality of coffee was indicative of the quality of ensuing discussion.

The event was organised by Sastra University and The Hindu. The moderator defined what was expected from each speaker. The first to speak was Bibek Debroy. He was supposed to talk on how foreigners view India. His decibel level was so high that I could not help wondering why he used the mike at all. Was he using the volume of his sound to make up for lack of depth in his talk? The moderator had earlier made a passing reference to 'Constitutional India'. Debroy went off at a tangent and spoke about basic structure of our Constitution, amendability of the Constitution and so on. It was pure histrionics. Of course, he was decent enough to admit that he was not speaking on what he was supposed to cover !

Madhu Kishwar was supposed to focus on gender issues. She took all the time in the world to comment favourably on the status of women in ancient India. A person in the audience reminded her that she was to talk on new India. She realised she was off-track but given the thankful limitations of time, she could not discover her focus. Her main argument was that Indian women do not need any patronising advice from foreign feminists.

Gurumurthy repeated parrot-like what has become his anchor for most discussions. Reference to IIT Bombay students, Adi Godrej and Macaulay has become his constant mantra. When he, as has become his habit, rhetorically asked, "Do you know which is the richest municipality in India, per capita income-wise?" (the answer is Morvi), I could not resist my urge to exit.

I had rearranged my schedule on Saturday to be able to attend this programme. I cursed myself on my poor choice.

Tuesday, April 03, 2018

Should Chanda Kochhar take a break?

Chanda Kochhar must be having horrendous times these days thanks to disclosures by the whistleblower, Arvind Gupta. She is only 56 years old and in the normal course she may continue as ICICI Bank's CEO and MD for some more years. (She became CEO and MD in 2009.)

Though the bank is not known for squeaky clean governance, nobody seriously suspected nepotism and blatant violation of ethical practices, save Arvind Gupta. He wrote to the PM, FM, SEBI and RBI two years ago. These authorities seem to have woken up suddenly now.

There are indications that all is not well in Axis Bank also. Shikha Sharma has come in for adverse notice by RBI. She was appointed the CEO and MD of Axis Bank around the same time as Chanda Kochhar became ICICI Bank's CEO. Both these persons were groomed and mentored by K.V.Kamath in ICICI Bank.

Nine years as CEO is an adequately long period to become accountable for any managerial misdemeanour. It is now worth asking if the private sector banks are mismanaged because their CEOs have a much longer tenure than desirable just as public sector banks are suffering from their CEOs' shorter than necessary tenure.

This philosophical question apart, Chanda Kochhar is verily facing an existential crisis in the bank. The bank's Board has expectedly and dutifully thrown its weight behind her. Yet, the fact remains that Chanda Kochhar has willy-nilly to spend a lot of her time agonising over various governance issues that are now talk of the town. The allegations may or may not prove her guilt, ethical or legal. But the damage is done for the bank and her.

Even if Chanda Kochhar cannot ultimately be faulted for any lapses which again may or may not be proved, she cannot now be in a position to do full justice to her role as leader of the bank. In these trying circumstances, she will do well for herself and the institution to quit her position at least temporarily till all enquiries are completed. The Board may hesitate to suggest this to her. But she has an opportunity to prove that she considers bank's interests to be more important than her own.

ICICI Bank claims that its culture ensures organic growth of leaders within the organisation. So there should be no dearth of managers within the bank who can easily fill up the void that Chanda Kochhar's exit may create.

Monday, April 02, 2018

Arvind Kejriwal's contempt of court

Arvind Kejriwal made serious allegations against many leaders of non-AAP parties. One does not know the veracity of these charges. At least, the accuser must have thought of them as true.

Some of these allegations have been fought in courts of law and considerable judicial time has been spent on them (injudiciously, in hindsight). Courts are already reeling under Docket Explosion. Kejriwal has done a signal disservice to Indian judiciary by preempting its precious time through diversionary tactics.

The courts should view this disrespect for judiciary seriously. Even if the accused have accepted Kejriwal's apology and are ready to withdraw their plaints, judiciary should put its foot down and demand that the accuser prove his charges or be punished for contempt of court. If the courts express their disdain for frivolous political allegations, politicians may learn to behave better.

Saturday, March 24, 2018

Controversial CAs

These are embarrassing times for CAs - Cambridge Analytica and Cricket Australia. Australian cricket team has never been known for integrity and fair play. It has crossed all limits of decency indulging in a planned tampering of the cricket ball while playing against S.Africa on Saturday.

One CA tampered with sanctity of data and the other CA with integrity of cricket ball. Both acts are just not cricket. Cameron Bancroft, the player who did the act and Steve Smith, the Australian captain have both accepted their wrong-doing. They could not deny because it was all caught on camera. If the brazenness of the act is shocking, the intention is shameful. The deplorable plan to tamper with the ball was hatched by the Australian cricket team during the lunch break. It is disgraceful that there was not even a single sane voice to counter the deceitful design.

Being the skipper of Aussie cricket team is deemed more prestigious than Australian primeministership. It is similar to President of Harvard University vs President of America. (Once, the secretary to Harvard President called up the White House and asked, "Is Mr.Kennedy {who was then American President} there ? Our President wants to speak to him." This incident may be apocryphal but it conveys a sense of the significance of Harvard University President.) Steve Smith has done incalculable harm to such an exalted  position.

Every cricket match is a prestigious event for Australians. However, this does not entitle the players to degrade themselves and the game by resorting to unlawful and unethical acts. Cricket is a game of decency and values. Cricket Australia has never understood this.