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.
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.
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