Just before Covid broke lose
Ratan Tata chaired a meeting
To approve a MoU for Mumbai Univ
It was at the Senate meeting which had been convened on a Sunday evening to approve a MoU between Mumbai University and IIT Alumni Council that Ratan made the famous statement “none can ruin iron like its own rust can.” The context of the quote is too unsavoury to repeat here. The quote though is remarkably apt.
When one thinks about it, one can notice that it is internal discord that ruins companies. Whether it is the destruction of Anil Ambani companies or Samir Modi – the culprit is often a spouse, sibling or vengeful employee. Breach trust is caused by those you trust. And trust is usually inherited or acquired. Mostly inherited. That is why legal and political dynasties pass on to family members.
As I see the corporate drama unfold at Tata Trust in full sight of the govt, the companies that constitute the Tata group and the country at large – every paradigm, every ethical value, every management doctrine that we all took as settled …. Is being laid bare. Of course every emperor is naked beneath the clothes. And even the emperor has to sit on his hidden throne each day.
The point is if and when the shit will hit the fan. Finally the resolution of each major conflict is with a gun. And not with a pen. The move of involving the govt was a good one. It keeps the CIA agents masquerading as independents at bay and under check.
Promoterless, board run, professionally managed companies are a great thing. But what if the independent directors themselves are havala operators buying overseas companies at inflated values to create a buffer to pay bribes to indian influencers overseas. Taking cash is becoming more and more difficult especially if conduits get caught.
Independent directors were not meant for this. Don’t know how we got there as a country.