ETHICS AND GOVERNANCE

WHAT THE LEHMAN & SATYAM

CRISES TAUGHT INDIA INC P. 12

BHASWAR
MUKHERJEE
CFO PROFILE p. 26

VOLVO XC60
STYLE ICON FROM
SWEDEN p.50

VOLUME 02
ISSUE 01
Rs.50
JANUARY 2011

CFO INDIA
ETHICS AND GOVERNANCE 12 | CFO PROFILE: BHASWAR MUKHERJEE 26 | STYLE ICON FROM SWEDEN 50
VOLUME

02

ISSUE

01

WHAT WE HAVE ACHIEVED, IS

NOTHING SHORT OF A MIRACLE,
SAYS MAHINDRA-SATYAMS CFO,
S. DURGASHANKAR, IN AN EXCLUSIVE
INTERVIEW WITH CFO INDIA
A 9.9 MEDIA PUBLICATION

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JANUARY | 2011

,16,'(

 &29(56725<
6$7<$05(78516
18 THE PHOENIX
The complete story of Satyam Computers resurgence
under the Mahindra-Satyam banner

22 TIGER RIDING FOR FUN

AND PROFIT
What the fall of Satyam and Lehman Brothers taught
companies about corporate governance

,16,*+7
30 EMERGING MARKETS STRAINING
GLOBAL FINANCE
Surging demand for capital, led by developing economies,
could put upward pressure on interest rates and crowd
out some investments

&)2352),/(
FUELING A
NATIONS HOPES



Bhaswar Mukherjee,
Director-Finance, HPCL
talks about the challenges
and the exciting future that
awaits the PSU

A little over 18 months after he assumed

charge at Mahindra-Satyam as CFO,
S. Durgashankar talks about the challenges

/($'(56:25/'
48 LEARNINGS FROM ADVENTURE
Truth, transparency and accepting responsibility
adventure sports teaches us crucial management lessons

&)2/281*(
50 ON WHEELS | VOLVO XC 60
52 GADGETS | MACBOOK AIR

&$6(678'<
44 SCALING NEW HEIGHTS
A lowdown on how the
iYogi team raised funds for two
campaigns in one year

,7+,1.

TOUGH TIMES,
TOUGHER TEAM

54 TRAVEL | FLORENCE
56 ART | SUDHARSHAN SHETTY
58 BOOKS | FAULT LINES



10 KAMAL PANDE
The Associate Director & CFO at Genesis Colors believes ensuring there are no leaks in the system is
a CFOs biggest worry today

5(*8/$56
04 LETTERS TO THE EDITOR
06 O-ZONE
60 NOT JUST THE LAST WORD

COVER DESIGN PRASANTH T R

AD INDEX

Nexstep Inside Front Cover | Financial Executive 02 | Empronc 05 | LeasePlan 17 | Ace Data 43 | PTC Value 53 | Speaker Bureau 59
| Airtel Inside Back Cover | ICICI Bank Back Cover



THE VALUE OF FEI MEMBERSHIP

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"Leading-edge content and objective research for the

competitive advantage I need to meet the demands
of a multinational computer technology corporation.
Taylor Hawes
CFO Intellectual Property & Licensing
MICROSOFT CORPORATION

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MANAGING DIRECTOR: Dr. Pramath Raj Sinha

The
Comeback
Kid

MAKING A STRONG COMEBACK when the world has given up

on you, is never easy, as those who have been-there-done-that will
tell you, (tennis ace Kim Clijsters and former India cricket skipper
Saurav Ganguly, to take just two examples from the world of sports).
And if it is tough for an individual, imagine how Herculean the task
must be when a captain realises the only way he can save a sinking
ship is if all his 27,000 employees understand his vision and work in
tandem like synchronised swimmers.
Truth however, is stranger than fiction. And the story of Satyam
Computers resurgence in 2010 ranks right up there among the most
amazing turnarounds in India Inc.s history. Eighteen months after a
Rs 6000 crore accounting fraud reduced the software giant to a pile
of rubble, their return to profitability under the Mahindra-Satyam
banner is a journey that deserves to be captured on celluloid.
Sadly we at CFO India are not (yet) into making films. So we did
the next best thing possible, spending a day at Mahindra-Satyams
sprawling campus in Hyderabad, meeting men and women who
refused to throw in the towel when their former chairman B Ramalinga Raju admitted he had taken the world for a ride for the past
eight years. The real highlight of our visit however, was a meeting with the man who led this financial transformation M-Sats
dynamic CFO, S Durgashankar. The challenges his team faced,
his vision for M-Sat and his views on whether similar scams are
waiting to be unravelled in India will definitely get you thinking.
Read the exclusive interview the most exciting part of our cover
package this time. (Page 12).
The rest of the magazine too is full of exciting stuff. As we reel
under another hike in fuel prices, we spoke to Hindustan Petroleum
Corporations Finance Director Bhaswar Mukherjee to find out what
the Fortune 500 firm is doing to be self sufficient by 2016. Taking
a cue from his word, we drove the new Volvo XC60 from Delhi to
Mumbai and beyond to test, among other things, its fuel efficiency.
There is a lot more to read as you turn the pages. Enjoy reading this
issue and do keep writing to us with your valuable feedback.

EDITORIAL
EDITOR: Anuradha Das Mathur
MANAGING EDITOR: Dhiman Chattopadhyay
ASSISTANT EDITOR: Anoop Chugh
CONTRIBUTING EDITOR: Bennett Voyles
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LETTERS

CFO INDIA

JANUARY 2011

Eye-opener

COVER

STORY

I enjoyed reading your cover story for December 2010. Since I work
for a financial firm, learning about how bank CFOs work was an eyeopener. The Case Study section where you interviewed the CFO of
Systime, was interesting. We too are contemplating an ESOP scheme
for our employees and reading about how Systime met the challenge
will definitely help us.

CFOs
of a different
Hue?

Suparno Singh, GM-Finance, LPD Financial Services Mumbai

01.11
WITTY IMITATIONS
Congratulations on the first anniversary issue of
CFO India magazine. It has come out very well.
It would be safe to call it a collectors item. The
caricatures have further enhanced the issue. I have
liked my caricature very much and would love to get
a high resolution soft copy of my caricature. I plan to
have that framed.
Ravi S Gupta, Sr. Vice President - Finance,
Jubilant FoodWorks Limited, Delhi

BURNING ISSUES
While CFO India is a magazine I enjoy reading,
I sometimes feel you do not touch upon burning
issues of the day, choosing to focus on pre-decided
subjects. Maybe you should have a current affairs
section or a few articles that deal with subjects that
are being discussed by the finance community, as you
go to press.
Shantanu Sen Gupta,
Jadavpur, Kolkata

GREAT LOUNGING WITH YOU

It is fun-to-flip through your Lounge section since
it gives us a glimpse of a world we aspire for. I do
not own a Mercedes-Benz or even an Audi yet but
reading about how it feels to drive one made me
4

CFO INDIA

JANUARY 2011

COVER STORY

LARGE TRANSACTIONS
HANDLED EVERY DAY,

HOURS SPENT ON
CONTROLS AND REGULATIONS
AND A CLOSE RAPPORT WITH
THE GOVERNMENT A BANK
CFOS JOB IS OFTEN DIFFERENT
FROM THOSE IN OTHER
INDUSTRIES. WHAT ARE THE
CHALLENGES THAT AWAIT THEM, POST
THE ECONOMIC SLOWDOWN
BENNETT VOYLES

ANIL T

ndia might lead the world in a number of industries, but when

it comes to banking, its still not even on the map. Of the top 50
banks, none are Indian. Three are Chinese.
However, that lack of flash may be a good thing for the
banks, and for India. The Western banks that suffered most in
the crash were precisely those that were most innovative and
most profitable before the crash. Thin capital reserves, thin liquidity
levels, weak risk management and lax regulations all obscured their true
risk profile, says James Lam of James Lam & Associates, a Boston-based
risk management consultancy.
Slow and steady has worked out well for Indian bank CFOs so far. They
may not have made the same big deals as their western counterparts in the
good times, but theyve also dodged the subsequent recriminations, public
drubbings, and shameful bailouts of the past two years. But will slow and
steady win the race?

IT IS DIFFERENT AT THE TOP

In many industries, being a CFO is lonely business. Whether you are the
sole non-engineer in a conference room of engineers or the sole finance
person in a room of sales guys, the CFO tends to be a little outside the
dominant culture. While the other executives are out and about, you are
Scotty down in the engine room, telling Captain Kirk that the ship cannot
take it anymore.
DECEMBER 2010

CFO INDIA

13

Your voice can make a change: Share your view point on whats
happening in the community and your feedback on the magazine at
cfofeedback@9dot9.in or editor@cfo-india.in

close my eyes and imagine the situation. One suggestion: even though
we are busy finance professionals, we do love to eat out sometimes! Can
you introduce a column where you feature the best new place to dine
out? It is just a suggestion.
Kanchan Sidhu,
Consulting Chartered Accountant, Delhi

HOW ABOUT TECHNOLOGY?

I would welcome more articles on technology and how finance
professionals can be made better aware of technological tools and their
use. I have co-founded a software solutions firm in Pune and coming
from a finance background, I sometimes find myself embarrassingly
ignorant of some of the latest advances in software technology. Please
do start a regular section where experts, perhaps even CIOs can advise
CFOs and other finance professionals on tech-tools and systems they
should know more about.?
Sandip Khare, Co-founder and CFO,
S&S Solutions, Hinjewadi, Pune

THEY MAKE US THINK

Its a pleasure to read the opinions of the people who matter. The
segment - I Think - is a great read as been-there-done-that professionals
from the finance industry put forward their view on relevant topics. I,
especially, liked Hiren Isranis (CFO, Microsoft India) piece in the last
issue where he had shared the insights on mastering the art of people
management. Keep it up!
Rahul Sane, ICWAI, Mumbai

01.11
THE LEAD

Price rise stumps

UPA government

Food inflation is down marginally from

December 2010, in January 2011

Vegetable prices, however, are rising
Govt has asked NAFED to sell onions

@Rs 35/kg
Govt also plans to curb export and ease

import restrictions. State agencies told

to buy essential commodities
Secretarial panel to review price rise
with individual states
Govt to encourage investment in supply chains to minimise wastage

THE GOVERNMENT OF INDIA has finally admitted that it has rather limited control over soaring vegetable and fruit prices a price rise that has led
to a huge jump in inflation. Announcing a 14-point agenda on January 13,
2011, a communiqu from the Prime Ministers office said the government
would review export and import of all essential commodities regularly and
6

CFO INDIA

JANUARY 2011

initiate stringent action against hoarders and black marketers.

In a significant move, all Public Sector Units have been told to intensify
purchases of essential food items such
as edible oils and pulses so that they
can distribute these through their own
retail outlets at subsidised rates.
The current bout of inflation is
driven by a rise in prices of vegetables
and fruits, which is more difficult to
manage because these commodities
are not held in public stocks, the
PMO statement said.
It said an inter-ministerial group,
chaired by its chief economic adviser
Kaushik Basu, will review the overall
situation while a panel of bureaucrats
under cabinet secretary KM Chandrashekhar will interact with states.
In another development Nafed, the

WHATS AROUND ZONE

cfobook ................................................................. Pg 08
No Honda, still a Hero......................................... Pg 08
India high on bribe list ......................................Pg 09
Friendly hires .......................................................Pg 09

THE CFO POLL

RESULT

Will the telecom

scam and events
surrounding it hurt
India Inc.s image?

75%
Yes

25%
No

CURRENT POLL QUESTION

Will the recent fuel hike affect the

governments attempts to curb inflation?
Vote now at www.cfoinstitute.com/poll

agricultural co-operative, has been instructed to sell onions at a subsidised price of Rs

35 a kg.
Albeit a bit late in the day, the measures
have come as good news to people at large.
However, observers fear this is too little and
too late. These measures are cosmetic in
nature and will have limited impact, Sunil
Sinha, head of research and senior economist
at Crisil, told The Economic Times.
While wholesale price-based food inflation
came down a bit to 16.91 per cent for the last
week of December 2010, from the years high
of 18.32 per cent, it did not stop vegetable
prices from shooting up by 3.84 per cent in
the first week of January, in comparison to
the previous week.
Meanwhile, the cabinet secretary has officially stated that he feels foreign direct investment (FDI) in multi-branded retail would
be a good way to try and tame soaring food
prices. Mr Chandrashekhar has submitted
his proposal in a presentation made to Prime
Minister Manmohan Singh and senior cabinet members.
India currently allows 51 per cent FDI in
single-brand retail and 100 per cent in wholesale cash-and-carry. Mr Chandrashekhar said
the sector could be opened up with a minimum investment of Rs 500 crore, 50 per cent
of which should be in back-end infrastructure, such as cold chain and logistics.
According to industry estimates, the lack of
back-end infrastructure results in wastage of
about 40 per cent of farm produce, worth Rs
50,000 crore, every year .

POPULATION

India To Miss 2045

Deadline
INDIA WILL NOT BE able to achieve its zero per cent population
growth target by 2045. In fact it might take a further 15 years to
achieve what is known as population stability.
The union health ministry had set itself the goal of attaining
replacement levels of fertility (when a couple has no more than
two children) by 2010 - to achieve
the larger goal of population
stabilisation by 2045. However,
by the end of 2010, only 14 states
achieved the target. In fact, six
states have fertility as high as
3-4. In all likelihood, therefore,
instead of reaching population
stabilisation in 2045 at 145 crore,
we will reach the target around
2060 at 165 crores.
Union health minister Ghulam
Nabi Azad feels improving the use
of contraceptives, IUCDs or pills will help India reach its target. The
government has, therefore, under a pilot project involving 150 districts, decided to use Accredited Social Health Activists (ASHAs) to
deliver contraceptives to the doorstep of villagers.
In an interview to The Times of India, Mr Azad said instead of
sending the contraceptives to states and letting them rot in their
godowns, ASHAs will be given contraceptives free of charge by the
Centre. The ASHAs will go from door to door in designated villages
and sell them at 10 per cent of the cost.
Population stabilisation is a stage when the size of the population remains unchanged. Global population is said to be stabilising
when births equal deaths.
JANUARY 2011

CFO INDIA

O-ZONE
cfobook

JARGON
DECODED

PUNCH
THE TREE

Rajesh Sharma
Wall

Info

Boxes

Whats on your mind?

Attach

Share
Rajesh Sharma has played a pivotal role in setting up timely and
accurate reporting systems which provide relevant information to
the key Stakeholders, regional and corporate, departments and
operations at Barista Lavazza.
December 13 at 10:50pm Comment Like

WORK
July 2006 Present (4 years 7
months); CFO, Barista Coffee
Company Limited (Privately
Held; Retail industry)
April 2002 July 2006 (4 years
4 months); Head-Finance,
Accounts & Legal; Global
Healthline Private Limited - 98.4
(Retail industry)
October 1999 March 2002 (2
years 6 months); Sr. Manager Finance & Company Secretary
Velocient Technologies Limited
(Retail industry)
February 1998 September
1999 (1 year 8 months) Member,
Singhania & Co;(Retail industry)

EDUCATION
LLB, Law - Delhi University
FCS - Institute of Company
Secretaries of India
ICWAI - Institute of Cost and
Works Accountants of India

Rajesh Sharma has effectively handled configuration & validation,

bill runs, robust RA processes to eliminate any revenue leakages,
strong revenue risk management processes to ensure compliances
to all collection, credit & risk related policies at Barista Lavazza.
December 3 at 7:30pm 5 people Commented Like

Rajesh Sharma has managed the staffing at Barista Lavazza and

created the finance, accounts, internal control and statutory
compliance while having perception that the department is to
support other departments in providing financial analysis.
December 1 at 1:10pm Comment 2 people Like this

I Read...

The Last Day Of My Life

September 29 at 1:35pm Comment 3 people Like this

I Sip...
Cappuccino, cold coffee
October 05 at 06:20 am Comment 5 people Like this
RECENT ACTIVITY
Rajesh Sharma likes CFO India and five others...

Rajesh Sharma likes Barista Lavazza, Punjabi food,

Continental food, Cash & Carry, Cricket
December 15 at 11:00pm Comment 5 people Like this

PAY MORE

Auto Insurance Costlier

INSURING YOUR VEHICLE could get costlier soon. A new price
structure proposed by the Insurance Regulatory and Development
Authority (IRDA) means car and bike owners will have to pay about
10 per cent more on new covers, while truck owners will have to
shell out around 80 per cent more than before. The IRDA has published its proposed new tariff for third party motor insurance - the
cover which compensates accident victims and has to be mandatorily purchased by all vehicle owners. The regulator has revised prices
considering that third party motor insurance faces a deficit that
could touch Rs 2,000 crore. While the premium for private vehicles
will rise, it will not be as steep as that for trucks. For a sub-1000cc
vehicle, the increase will be from Rs 670 to Rs 740, while for cars up
to 1500cc the premium will rise from Rs 800 to Rs 880.
8

CFO INDIA

JANUARY 2011

THE DEFINITION
Punch the tree
suggests that one
vent anger at an
inanimate object in
lieu of the person
who caused it.
THE USAGE
Dont hurt your
hand by trying to
box a Neem tree if
your colleague tells
you to Take five,
punch the tree, and
come back in here
with a clear head.
All that he wants is
for you to glare at
the table lamp next
to you instead of
shouting at some
poor soul!

O-ZONE
TINY TECH

NOW, AN IPHONE APP FOR

TODDLERS
INTERNATIONAL PUBLISHING
HOUSE Penguin has released what
seems to be one of the first book apps
designed for children as young as three
months apparently to help enhance
their hearing, visual and motor skills.
The Baby Touch Peekaboo App goes
live in the Apple app store and brings
to life the popular Ladybird series of
books on the touchscreen.
The application has been specifically
designed for and tested on toddlers
so they are able to easily interact with
the story on a touch screen device.
Simple taps of the screen make different characters appear in lots of bold

colours with sound effects. Anna Rafferty, managing director of Penguin

Digital, said: We are not aware of any
other apps designed specifically for
babies. The Baby Touch series of books
has been extremely popular since its
launch in 2005 and we thought it was a
good story to turn into an app.
She said that the target group was
from three to 12 months old and that
babies as young as six months would
be able to operate the app without
their parents help. The app also features an auto play tool - which allows
parents to play the entire content of
the app as a movie.

FLYING HIGH

A-380 From India Soon

INDIA MAY SOON see the
first commercial operations of
the worlds largest airliner
Airbus A-380. German major
Lufthansa has sought a government nod to fly the super-jumbo jet on a daily basis between
Delhi and Frankfurt from May
15, making IGI its fifth destination for this aircraft after
Tokyo, Beijing, Johannesburg
and New York, reports The
Economic Times.
Enabling this would require
alteration in the existing IndoGerman bilateral agreement
that allows Boeing 747 as the largest plane flying between the two countries, a
clause that would have to be changed to include the A-380. Delhi now has a terminal and runway that can easily accommodate the A-380. Reacting to Lufthansas
request, a cautious sounding aviation minister Praful Patel said: The ministry
will examine it. On the other hand, the airline is upbeat. Lufthansa is ready to fly
the A-380 on the Delhi-Frankfurt route from this year. We have applied for acquiring the rights for this flight in India, said Axel Hilgers, Lufthansas director-south
Asia. The preparation, among other things, requires getting a flight caterer with a
lift to load food trays on the second deck of the aircraft!

SNIPPETS
IPL drama
Shah Rukh Khan has realised
not retaining Sourav Ganguly
for his KKR team may cost
him not just fan following but
also a lot of money. With thousands of Dada fans vowing to
boycott KKR matches, not only
will KKR lose gate receipts but
sponsors may also back out
fearing lack of enough eyeballs.
An olive branch is now being
handed out to the Price of
Kolkata. SRK, in fact, has said
he always wanted Sourav to be
part of Kolkata Knight Riders.
Dada is like a younger brother
to me and I want to win more
games together, he said. Will
Sourav listen?

IndiGos record

Domestic low-cost carrier

IndiGo has ordered180 Airbus
A-320 single-aisle aircraft for
$16.4 billion (Rs 742.24 billion). The deal is said to be the
largest jet order in commercial
aviation history.
Under the agreement, the
airline will acquire 150 of the
upgraded A320 aircraft that are
loaded with more fuel-efficient
engines. IndiGo will also buy 30
planes of the standard singleaisle type. France-based Airbus
will start delivering the planes
in 2016. It is expected that the
aircrafts deliver fuel savings of
up to 15 per cent, along with
cuts in pollution.

Nuclear insurance

Providing insurance cover for

nuclear accidents has become
the major concern of Insurance
Regulator IRDA which is in its
early stages of drafting a regulation for the same.

JANUARY 2011

CFO INDIA

CFO

I THINK

Facts & Trivia

EDUCATION: LLB from Delhi University
PROFESSIONAL QUALIFICATION:
Chartered Accountant , from ICWA, 1985
FIRST JOB: Auditor, Ramnath Iyer & Co
PREVIOUS JOB: CFO , Timex Watches
PASSIONS: Networking, travelling

A STRATEGIC PARTNER, THE

conscience keeper and the person
the board and stakeholders trust with
implementing stringent corporate
governance norms the role of the
Chief Financial Officer has evolved
over the years and today the CFO
plays a pivotal role in the companys
plans. Increasily, the CFO acts as a
partner of the CEO/MD/promoter in
developing and implementing long
term strategic plan for the company.
However, the diversity of roles has, if
anything, also added to his worries.
Traditionally the backroom guy, the
CFO today is often the face of the
company, speaking to the media and
facing stiff challenges when executing critical assignments, especially
where coordination with other agencies is involved.
The promoter or the CEO also looks
up to the CFO to ensure that there
are no leakages or loopholes in the
10

CFO INDIA

JANUARY 2011

KAMAL
PANDE

The Associate Director & CFO at Genesis

Colors believes ensuring there are no leaks in
the system is a CFOs biggest worry today.

systems, anywhere in the company.

While during the growth phase all
systems and processes that a CFO
would like to follow are compromised
in the name of speed and need, the
CFO still has to ensure there are
enough preventive checks in place to

With costs
going up in all
categories, there
is great pressure on CFOs
to figure out
ways to make
up for these
increases.

minimise chances of fraud. This is

actually one of the biggest worries that
keeps todays CFO awake at night.
Another major issue that bothers
a CFO, especially if he is in the retail
sector, is the possibility of revenue
leakage by front-end sales staff in
stores by manipulating invoicing and
discount policies and procedures.
With employee turnover increasing
in retail, one other area that keeps
CFOs on their toes is the challenge to
ensure that all front-end employees
are trained and educated in preventive
controls that must be deployed to avoid
leakage of revenue or costs.
While the company may have well
documented processes and procedures,
ensuring that new employees are
trained properly is a regular headache.
Very often when a failure is detected,
it is found out that it happened
because the person involved was a new
employee who had not been properly

NITISH KUMAR

inducted, thanks to an urgent need to

put him on to a job straight away. Of
course a critical aspect of any CFOs
job is meeting the targets set out in the
companys budget.
While the sales head is responsible
for the top line of the company, the
bottom line is the CFOs responsibility
and every CEO or promoter expects the

CFO to keep a tight watch on the bottom line of the company.

With expenditure going up in all
areas from raw material to manpower
costs as well as other direct and indirect overheads, there is tremendous
pressure on the margins, and the CFO
is spending an increasing amount of
time figuring out ways and opportuni-

ties to rationalise spending to make up

for these increases in expenditure.
To add to this is constant pressure
from the private equity partners
who expect the firm to deliver on
their promise as their valuations are
directly dependent on the companys
ability to meet the targets set out in
the annual budget.
JANUARY 2011

CFO INDIA

11

&29(56725<

4 $

&29(56725<

WHAT WE
HAVE ACHIEVED
SO FAR IS
NOTHING
SHORT OF A
MIRACLE
A LITTLE OVER 18 MONTHS
after he assumed charge at
Mahindra-Satyam as CFO, S
Durgashankar talks about the
challenges he and his team
faced every day
DHIMAN CHATTOPADHYAY

hen S Durgashankar took over as

CFO of Mahindra Satyam in June
2009, there was mayhem all around.
His near impossible task: To set the
house in order at Satyam Computer Services Limited, a company
affected by a whopping financial scam and to help turning
its fortunes around. In less than 15 months, the companys
annual accounts not only for 2009 but also for 2010 fiscal year
were compiled and audited. The Annual General Meeting

A.PRABHAKAR RAO

of the Company has been held and the accounts have been
approved. The Company is also current in its Indian GAAP
filing, having published Q1 and Q2 results for the 2010-11
financial year. The companys operations have turned profitable. With most of the debris left by the scam now cleared,
Dhiman Chattopadhyay met a relatively relaxed Durgashankar at the companys sprawling campus in Hyderabads
Hitech City to find out how Team M-Sat tackled the challenges
head on, the road ahead for the company and whether India
could face similar frauds in future.
JANUARY 2011

CFO INDIA

13




&29(56725<
If you had to prioritise
where the biggest problem
lay in the Satyam scam
people, processes,
technology what would
you say?
Technology and processes are created
by people and while a defective
technology or a defective process
can be set right, defective people are
much harder to identify and correct.
I would even go so far as to say that
while having good processes is very
important, it is even more important
to have good people at the helm.
If one had to make a choice between
having good people at the helm but
with not-so-good processes & systems,
and having good systems but with
not good people at the helm, I would
always choose the first option.
Hence, if I were to identify the
biggest reasons for the scam in their
descending order of priority, it would
start with people (the defective ones)
and only then followed by defective
processes and technology. While
Satyam always had the advantage of
having committed employees in its
fold, on hindsight, it is clear that it also
had some not-so-great individuals and
it is this lot that was the major reason
for the problems.

Could what happened at

Satyam been avoided?
This is a very interesting question. It
is also contemporaneous, given the
number of scams that we see reported
almost daily in the newspapers.
Strictly and only as a matter of theory,
if we had the right societal values,
right processes and systems, right
checks and balances, right deterrent
mechanisms, then my answer would
be Yes, it could have been avoided.
However, as a practical matter, given
our existing social values, complex
accounting systems, market based
incentives etc, in my view, a scam like
this was always waiting to happen and
hence was inevitable.
14

CFO INDIA

JANUARY 2011

Do you think a scam like

this can happen again in
India?
As per Cresseys (Donald R Cressey)
Fraud Triangle theory, fraud occurs
due to the conjunction of three factors:
The Motive, the Rationalisation and the
Opportunity for committing a fraud.
In India today, we have a society
where financial success is the only type
of success that is recognised, where
corruption and dishonesty are tacitly
accepted as a way of life, where financial ends justify following any means,
a system of accounting that is complex,
where the market focuses brutally on
quarter-on-quarter performance and
where the persons who are responsible
for reporting the numbers are incentivised (through market-based incentives)
whenever higher financial numbers are
reported. Given this volatile cocktail of

issues, let me ask you back - dont you

think a scam like this can happen again
in India?

Over the last 18 months, as

CFO of Mahindra-Satyam,
what has been your key
focus? What are the three
most critical measures you
have taken to bring things
back on track?
I believe my role, like that of any CFO,
is first to stand up for the right values,
to stand up for integrity and honesty
in business and to have the moral
courage to speak my mind. I believe
that I have done so till now and will
continue to do so. There is great pride
and satisfaction in working for a company that does business honestly,
whatever be its profitability, than in

&29(56725<
working for a company with higher
reported profits, arrived at through
dubious means.
Hence, the most important focus
areas are putting transparency and
honesty back on the agenda, bringing
the feeling of self-pride and self-worth
back to the finance team and improving the internal control systems and
processes. Brahmayya & Co was
engaged in the initial days to identify
the lacunae in internal controls, many
of which have now been set right. New
statutory auditors (Deloitte) and new
internal auditors (Grant Thornton)
have been appointed. KPMG, which
did the investigation for the company, was roped in to help finalise the
accounts. BDO Haribhakti helped
with setting up SOX related controls.
Ethics and whistle blower policies too
were revamped.

Looking back, if you were

the CFO of the erstwhile
Satyam, what would you
have done differently?
When I look back, I sometimes feel we
could have put in place an ERP system
sooner. We are in the process of doing
so now. But to be honest, I think the
team was already stretched for time.

Do you regret not having

implemented this earlier
though?
With the benefit of hindsight, it is
always possible to find things that one
may want to do differently. But then
when we came in we were battling
a dozen issues at the same time. We
had ongoing investigations by various
investigative agencies where our people
were grilled for days on end. The information needed to aid the investigations

7+(0267
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was to be provided in great detail across

a period of 8 to 10 years. We had new
statutory auditors and new internal
auditors, who had to first familiarise
themselves fully, which resulted in
going over vast amounts of information over and over again with different
agencies. A substantiated part of our
data was in CBI custody, which compounded the problem of access.
We had to do all this in a situation
where the old top finance layer had left
or was in legal custody, and a new top
layer had just taken over. The pressurecooker atmosphere resulted in very
high levels of attrition, which further
compounded problems. Motivational
levels were low, given the unremitting
work load and pressure. We were also
battling multiple legal cases. Amidst
all this we had to keep the day-to-day
operations going.
I am proud that my team rose to the
occasion in an exemplary manner. Each
team member was doing the job fit for
three or four people. When one looks
back after the dust has settled, there are
always a few decisions that we might
have taken differently.

As CFO of MahindraSatyam, what is your

primary responsibility going
forward?
We are now current on I-GAAP. Our
next task is to become up-to-date on
US-GAAP and from April 2011, to conform to the new IFRS norms. I also see
improving the Management Information System (MIS) as a key task in the
months to come.

What are the biggest

challenges on the horizon?
From a finance perspective, I think we
have won two large battles by getting
our accounts up-to-date and by regaining the trust among shareholders and
clients. The challenge now is to help
improve the revenues and the margins
of the company.
JANUARY 2011

CFO INDIA

15

&29(56725<
You have been a CFO at
various firms for many
years now. However,
this must have been a
unique experience. Any
key takeaways or lessons
learnt here?
The important lesson for me really
has been the discovery of what can be
achieved by people coming together.
The job we had set out to do in finance
was a very tough one. It was a race
against time and against all odds. It
was done only because of the grit and
determination shown by my team, by
many across our company and also by
the auditors.
My biggest takeaway is that the
right cause ignites the passion of the
people involved and they dig deep into
their mental and physical resources
to deliver on even impossible tasks.
The right cause also unites people
across the spectrum and brings them
all together. I remember that on the
last day when we were completing
the accounts, the room was full of
accountants and auditors. I noticed
several of the auditors sporting a
stubble and asked them about it. One
of them said, Forget about having the
time to shave, none of us had the time
to even shower for the last 72 hours.
Such was the level of commitment
that was demonstrated by people
across the spectrum.
Another example is that on the
same day, when the announcement of
financial results was being covered by
the media, my room was packed with
more than 50 people (accountants
and auditors alike), all watching the
television. Many of them were close to
exhaustion and while waiting for the
news coverage to start, some could not
help nodding off due to prolonged sleep
deprivation. When the announcement
of our results was made, all those
assembled were standing up and
cheering as one. To me it was a moment
of revelation of how a just and fair
cause can bring people together and
make them move mountains.
16

CFO INDIA

JANUARY 2011

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As a CFO, the reputation
of where you work is
paramount. Did you think
hard before taking on this
role given the tarnished
image of the organisation?
Not really. You see, coming from the
M&M stable, I was aware of the very
high value systems espoused by the
group and I knew that I had nothing
to worry about on that score.
However, I would be lying if I said
that the enormity of the challenge
did not worry me. It was a daunting
problem and I did have sleepless
nights wondering how we would
accomplish this gargantuan task.

Still, public perception

remains. Did the scam
and its aftermath lead to
problems in attracting
talent or convincing banks,
investors or clients?
The problem was there in the beginning. Immediately after the scam, our
employees had problems in getting
loans and credit cards. However, there
were a few banks who stood by us in
times of trouble and helped us during
those difficult times. Thanks to the
tough guys who chose to stay back, dig
in and fight, we were able to see this
challenge through.
Today, the banks are back in queue
to lend and we dont have problems in
attracting banks, employees or talent. It
is back to business as usual.

From the CFOs chair, how do

you rate the role played by the
board in the recent past?
The company is very lucky in having
excellent members of the board during both the government hand-holding
period, as well as now. These are men of
unimpeachable integrity, of exceptional
talent, with fantastic track records and
with extraordinary commitment and
vision. The government-appointed board
had the task of steering the ship during
the days of uncertainty.
It is a tribute to their vision and commitment that within three months they
could retrieve the situation and, through
a transparent bidding process, bring in
a strategic partner (Tech Mahindra). The
current board has continued this awesome work and is taking all possible measures to put the company back on the
road to higher profitability. I am fortunate
to enjoy the full support, guidance and
encouragement of the board in accomplishing the task.

What are you looking forward

to? When will you feel you
have been successful as the
CFO of Mahindra-Satyam ?
We are now well past questions of viability and stability of the company. My task
is to take the company back to its days of
glory but this time it will be an all round
growth based on real performance. The
task of the CFO, as part of the senior
management team, is to help contribute
to this cause.

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COVER STORY

SATYAM RETURNS

When B Ramalinga Raju

admitted to a Rs 6000
crore fraud in January
2009, Satyam Computer
Services lay discredited.
Heres the story of
their resurgence under
the Mahindra-Satyam
banner

DHIMAN CHATTOPADHYAY

S MILLIONS OF spectators across

the world watched Spains Andres
Iniesta tapping in what would be
the winning goal of the 2010 FIFA
World Cup final in South Africa,
most did not notice a large red and
white banner advertisement placed just behind the
goal post. Those who did and those who had kept
track of corporate frauds in India, however, were surprised to see what it said: Mahindra-Satyam, official
IT service providers for FIFA 2010.

18

CFO INDIA

JANUARY 2011

COVER STORY
That 10-feet banner encapsulated
the amazing story of Satyams turnaround 18 months after the top
management of what was then Indias
fourth-largest software company was
bundled off to prison following a
Rs 6000 crore accounting fraud. Their
remarkable reversal of fortunes in the
months following Tech-Mahindras
acquisition of Satyam (re-christened
Mahindra-Satyam) is perhaps one
of the best examples of what good
corporate governance coupled with
dedicated teamwork and a little bit
of financial genius can do. After all,
turning a Rs 1250 crore loss-making
firm into a profit-making one in 12
months, while dealing with demanding investigators, noisy shareholders,
unsure clients and a sceptical public,
is nothing short of a miracle.

THE BODY BLOW

Things were very different in the
days following Rajus confession. You
could hear a pin drop in the canteen
that January, remembers Sudhir K,
an engineer who joined Satyam just
three months before January 7, 2009,
when the groups chairman, B Ramalinga Raju, admitted to the world
that he had fudged accounts to show
a non-existent bank balance of Rs
5040 crore. That startling confession,
would almost overnight, push Satyam
to the edge of the precipice.
I remember reading his letter
where he says it was like riding a tiger,
not knowing how to get off without
being eaten, and thinking my career
was probably doomed before it had
even begun, says Sudhir, as we sit
in the 1000-seater cafeteria that offers
cuisines from around India and much
of the world in keeping with the
companys multilingual and multicultural workforce. The cafeteria is buzzing today with smiling faces and
animated conversations suggesting a
return to happy days. The transformation continues to amaze us, adds
his colleague Sunaina Iyengar.

VITAL
STATS

HOW THE DEBRIS

WAS CLEARED:
IN NUMBERS

100
There were

forensic investigators on
campus through 2009

THEY REVIEWED 2 TERRABYTES OF

DATA, ENOUGH TO FILL

2,70,000
FILE CABINETS

2 million
Over

e-mails were reviewed as well

300

SOME

COMPUTER HARD DRIVES

WERE IMAGED

Mahindra-Satyam lost

17,000

employees between January 2009

and October 2010

M-SAT APPOINTED NEW

EXTERNAL AND INTERNAL
AUDITORS AND GOT A
LEGAL OMBUDSMAN IN
PLACE
For nearly

18 months,
the entire finance team and many
others worked through weekends

BY NOVEMBER,
THEY WERE UPTODATE ON INDIA
GAAP
The company bounced back
from a consolidated loss of

Nearly

1 billion 1250
lines of transaction data were
analysed

200
STATEMENTS WERE SOUGHT FOR

BANKS ACCOUNTS

crores

in 2009-10, to net profits of

97.5 crores
23.3 crores
and

in Q1 and Q2 of the 2010-2011

fiscal
JANUARY 2011

CFO INDIA

19

COVER STORY
These have indeed been unusual
months for everyone at M-Sat, and
everyone from the top management to
the young techies agree on one count
that their Phoenix-like resurgence was
made possible because every one of the
27,000 employees genuinely believed
that challenges of any nature could be
met if they worked as one.

OVERCOMING HURDLES
Spearheading this transformation is the
150-strong finance team under CFO, S.
Durgashankar, many of whom went 18
months without weekends, often working till late and returning to office the
next morning at 9. And the results have
been satisfying. Mahindra-Satyams
first ever Q1 and Q2 results are out
(2010-11) and from a net loss of Rs 1250
crore in the 2009-10 fiscal, things have
looked up with consolidated profits of
Rs 97.5 crore and Rs 23.3 crores in Q1
and Q2 respectively. In simple terms
this means all accounts of the company
are now up-to-date and instead of losing clients, staff and money everyday as
they were doing back in 2009, M-Sat is
a growing baby today.
The journey to relative nirvana
was by no means easy. One look at
the situation at the time of the TechMahindra acquisition will tell you so.
In May 2010, as the new management
assumed office, nine different inves-

ALL ACCOUNTS OF
THE COMPANY
ARE UP-TO-DATE
AND INSTEAD OF
LOSING CLIENTS,
STAFF AND MONEY
EVERYDAY AS THEY
WERE DOING IN
2009, M-SAT TODAY
IS A GROWING BABY
20

CFO INDIA

JANUARY 2011

Everyone across functions

chipped in. Some helped verify
data, others volunteered to meet
clients and convince them to stay
on while others ensured incidental
costs were taken care of.
VVK RAJU , SENIOR VICE PRESIDENT, MAHINDRA-SATYAM

tigating agencies hovered over their

heads everyday, questioning employees and demanding documents. They
included officers from the CBI, SEBI,
ED, Security Exchange Commission,
the IT department and the Registrar of
Companies. Each day, members from
M-Sats finance team did their daily
work and then spent hours being interrogated by these officers.
Here are some facts for you to
digest, laughs CFO S. Durgashankar,
proceeding to rattle off figures. There
were 100 forensic investigators on campus who reviewed 2 terrabytes of data,
enough to fill 2,70,000 file cabinets as
well as over 2 million e-mails. Other
teams imaged 300 computer hard
drives, analysed 1 billion lines of transaction data and sought statements for
200 banks accounts.

A LESSON IN TEAM WORK

As any CFO would agree, this was work
even a 200-member strong team would
have struggled to undertake. And here was
a team less than half its size, and one that
was losing colleagues almost every day
(Mahindra-Satyam recently announced
that it had lost 17,000 employees in the
past two years) being asked to perform
a superhuman feat. That we could do it

was thanks to the undying spirit of those

who stayed on, colleagues who literally
lived in office forgoing weekends and
holidays. Everyone across functions
chipped in. Some helped verify data,
others volunteered to meet clients and
convince them to stay on and still others
paid money from their own pockets to
make sure incidental costs such as travel
and hotel stays were taken care of till we
could get a system in place, recalls VVK
Raju, now senior VP finance at M-Sat and
a Satyam veteran of 9 years.
The next several months witnessed
frenzied activity across the company
as the senior management got down
to clearing the debris. But there were
many obstacles along the way not the
least of which was coming to terms
with what had happened.
VVK remembers those initial days
well. My first reaction was complete
shock. Till then, as Satyam employees we
were made to feel special wherever we
went in Hyderabad. Overnight much of
that changed. Some banks even stopped
issuing credit cards, he says.
Agrees MV Sridhar, VP marketing,
when I meet him over a cup of coffee later
in the day. A former first class cricketer
for Hyderabad Doc as he is known to
colleagues, (he is also a qualified medical
practitioner) says he felt a sense of

COVER STORY

Satyams success was real.

The businesses we had, the
products, were all real. No one
was willing to let go of all that
good work.
M V SHRIDHAR, VICE PRESIDENT MARKETING, MAHINDRA-SATYAM

disbelief when he heard the news. To

all of us the man (Raju) and his stature
was awe inspiring, he remembers.
Thankfully, dark clouds soon gave
way to hope. Within a day of the scam
becoming public, most surviving senior
executives met and decided to brave out
the storm instead of quitting. We had
to fight it out says Sridhar. And stick
together they did. Till the Mahindra
acquisition (in May 2009) 99 per cent
of the surviving leadership stayed put
to salvage what remained. Satyams
success was real. The businesses we had,
the products we had, were all real. No
one was willing to let go of all that good
work, he says, sounding every bit like the
dogged opening batsman, determined to
brave out all that is thrown at him.
More hope and reassurance came
within the next 72 hours, when the
Government of India stepped in. They
acted fast, announcing the appointment
of the interim board on a Sunday. The
very next morning all board members
had arrived in our office. It gave us all a
boost, recalls Sridhar.

THE FINANCIAL
TURNAROUND
The real credit for the companys return
to the path of growth however, has to go

to the finance department. Most employees I spoke to in M-Sats HR, marketing and communications departments
believe reaching todays levels would not
have been possible but for the finance

while costs were cut and manpower rationalised, the company brought in Deloitte
and Grant Thornton as auditors, appointed an ethics ombudsman and set in place
a strict whistle-blower policy. Next came a
number of manual controls to minimise
chances of any accounting errors and the
painstaking task of restating accounts for
the past eight years.

A JOB HALF DONE

Indeed both the balance sheet as well
as the mood in the campus clearly suggests the worst is over. But, as Durgashankar points out, even though a
lot of debris has been cleared, the job
is far from over. Some of the scars, for
instance, will take longer to heal. It has
been a painfully slow return to growth
thus far, says the CFO.
The good news is that today M-Sat
gets 20 per cent of its new hirings from
Tier-I companies such as Infosys, Wipro
and TCS. It indicates that most of the old

WHILE COSTS WERE CUT AND MANPOWER

RATIONALISED, THE COMPANY BROUGHT
IN DELOITTE AND GRANT THORNTON
AS AUDITORS, APPOINTED AN ETHICS
OMBUDSMAN AND SET IN PLACE A STRICT
WHISTLE-BLOWER POLICY
team. Essentially this was an accounting fraud and the ones who could really
bring things back on par would have to
be us finance guys. We knew we had to
perform, says VVK.
It was a herculean task though. If
doing the entire restatement of accounts
for the past eight years was a big ask, then
to come up with Q1 and Q2 results in just
a month after that, was amazing, says
Sridhar, adding, the finance guys are
really the unsung heroes for me.
Realising the need for quick action,
Durgashankar set in motion a few changes upfront. Re-establishing credibility
and financial transparency came first. So,

credibility is back. Our conversion rate

(actual number of new joinees compared
to offers made) has also gone up significantly in the past 12 months. It is now a
healthy 68 per cent, well above the industry average, says Sridhar.
The key task now, as Durgashankar
concludes, is to ensure profit margins
keep growing. We were the leaders
in the business solutions space. The
big challenge now is to get back to the
top, he says. And if the kind of teamwork and resolve that the entire team
at M-Sat showed during the past 18
months is any indication, achieving this
task will just be a matter of time.
JANUARY 2011

CFO INDIA

21

COVER STORY

ETHICS INC.

What the fall of Satyam

and Lehman Brothers
taught companies about
corporate governance

BENNETT VOYLES

t has been two and a half years now

since Lehman Brothers declared
bankruptcy, and two since the Satyam
Computer Services scandal broke.
Lehmans $600 billion implosion
contributed to many other collapses
and precipitated a global financial crisis. Satyams revelation that $1bn+ in reserves were
imaginary wasnt big enough to precipitate
a crisis, but it too had an outsized impact,

22

CFO INDIA

JANUARY 2011

shattering an image not only of a respected

company, but the probity of India Inc. itself.
What have we learned? It is easy to blame
both disasters on bad leadership one weak
choice that led to a long string of others. Certainly that is part of it. But the misrepresentations of earnings quarter after quarter at
Satyam, which chairman B Ramalinga Raju
described memorably as like riding a tiger,
not knowing how to get off without being

COVER STORY
eaten, took more than a conspiracy of
executives. Lehmans troubles too -- so
large that the company couldnt even
estimate it werent only the product of
the executive suite.
For Lehman and Satyam alike, the
executives tiger ride required a whole
circus of witting and unwitting supporters including levitating board
members, acrobatic accountants,
shortsighted regulatory ringmasters,
and most of all, investors and lenders
in the stands happy enough to keep
watching the show. Without early
detection, disclosure problems that
began cub-sized gradually grew into
man-eating beasts.
Of course, not many companies ever
get into this degree of trouble. Ishaat
Hussain, the CFO of Tata Sons, points
out that out of the thousands of major
global corporations, he can only think
of five major corporate failures in the
past decade which involved fraud. Even
Lehman, he says, he would classify less
as a cause of fraud and more of excessive risk-taking. By and large, people
want to do good and behave properly,
he says. I sit on many boards and I
dont think anybody is there to take the
shareholder for a ride by choice.
Still, there are other good reasons to
think about governance. Good governance means running a corporation
so as to make the best possible use of
the savings people have invested in it,
says Randall Morck, a finance professor at the University of Alberta School
of Business and a specialist in global
governance issues.
It is also a good way to get cheaper
credit. A number of studies have correlated better corporate governance
with a lower cost of capital, according
to Krishnamurthy Subramanian, assistant professor of finance, Indian School
of Business, Hyderabad.

THE BOARD
Boards tend to be high on many governance fix-it lists, for obvious reasons.
In too many cases, like Lehman Broth-

Good governance means

running a Rs 6000 crore
corporation so as to make the
best possible use of the savings
people have invested in it.
RANDALL MORCK, PROFESSOR OF FINANCE, UNIVERSITY
OF ALBERTA SCHOOL OF BUSINESS

ers and Bear Stearns, the CEO virtually hand-picked the directors, says J.
Richard Finlay, founder of the Torontobased Centre for Corporate & Public
Governance. The lesson of this financial meltdown, as it was in the 1930s,
is that directors need to ask discerning
questions and they need to remind
themselves that they are there to prevent disaster - not to be passive bystanders to it, as they too often have been.
In India, director independence is
also an issue, but for different reasons.
The average listed Indian company is
48 per cent owned by the promoter. In
some ownership is as high as 80 per
cent according to Umakanth Varottil,
an assistant professor of law at the
University of Singapore. Due to the
dominance of the controlling share-

A number
of studies
have corre-
lated better
corporate
governance
with a lower
cost of
capital

holders, they are able to determine the

composition of the board and senior
management, he says.
Varottil argues that this can be corrected through special elections that
give minority shareholders more say,
such as votes that exclude the promoter
from voting on director hiring.
The idea is that independence breeds
independent thought. But independence
may be less of a guarantee of uprightness than it is billed. One case in point:
Satyam, winner of the 2008 Golden Peacock Award for corporate governance,
did have six independent directors,
including four academics, a former cabinet secretary, and a retired executive.
So why do boards not seem to uncover more dirt?
One factor may be that it is hard to
be in a group and yet maintain independence. In all my life, working with
the professional accounting firms I
have never seen a dissenting minute.
That does not auger well, says Kaushik
Dutta, New Delhi-based author of several books on corporate governance and
an advisor on corporate governance to
the Institute of Corporate Affairs of the
Ministry of Corporate Affairs.
Another is that it is not easy to track
a major company with thousands of
employees and global operations as a
part-time job particularly if you have
no particular training in the industry.
Boards dont meet that often. They
have limited resources and yet we expect
them to figure everything out, says Afra
Afsharipour, acting professor at the University of California, Davis School of Law.
JANUARY 2011

CFO INDIA

23

COVER STORY
In India, the Satyam scandal seems
to have acted as a catalyst in making
the corporate world see just how
difficult and risky board membership
can be.
A large number of board members
quit right after Satyam, particularly
the most senior members who would
have the most to lose from a scandal.
Many academics and people who
cared for their reputations went flying for cover, Subramanian says. In
January 2009, he says, 120 directors
left, five or six times greater than the
normal turnover.
Not surprisingly, directors salaries
have risen 12 to 15 per cent since January 2009, according to Subramanian, a
reflection of how much more work is
being required of directors now -- and
how much harder it is to find someone
who will take the job.

UNDER THE BIG TOP

But no matter how closely the nobs
hob-nob, one of the biggest lessons of
both collapses is that they need to talk
to everybody else too. The biggest governance problems always seem to come
where people are afraid to argue with
a powerful CEO or a business family
patriarch, says Morck.
Bu s i n e s s s h o u l d l e a r n f r o m
governments, Morck advises. Most
governments he says, have learned
over the years that opposition is
ultimately beneficial. Leaders in
power understandably hate this, but
most people in most countries think
it delivers better governance than
any alternative system on offer. The
criticism slows down decisions, but
democracy protected India from great
leaps forward and cultural revolutions.
Such transparency is also valuable
externally. Vikramaditya Khanna, a
professor of law at the University of
Michigan, says that in most of the
major corporate implosions of the
past decade, earnings management
whether inflating revenues or hiding
losses has been a consistent thread.
24

CFO INDIA

JANUARY 2011

I sit on many boards and I

dont think anybody is there
to take the shareholder for a
ride by choice
ISHAAT HUSSAIN, CFO, TATA SONS

Boards dont meet that often.

They have limited resources
and yet we expect them to
figure everything out.
AFRA AFSHARIPOUR, UNIVERSITY OF CALIFORNIA,
DAVIS SCHOOL OF LAW

THE ROUSTABOUTS
It is no coincidence, then, that accountants have been implicated in many of
the recent corporate scandals and disasters. In Lehman, Satyam, Enron, even
Parmalat, auditors seem to have had
some sense of what was going on, says
Khanna, and yet you do not seem to
see a great deal of disclosure about it.
Despite the destruction of Arthur
Andersen in the Enron scandal and
stricter supervision of external auditors
by audit committees mandated for large
US traded-companies by SarbanesOxley, problems still seem to crop up.
This is perhaps not too surprising.
As American social critic Upton Sinclair once quipped, It is difficult to get
a man to understand something when
his salary depends upon his not understanding it.
Some critics charge that the credit
rating agencies also played a role, giving positive, investment-grade ratings
to Lehman Brothers right up to its
collapse. Standard & Poors analysts
denied it, in a report released a few
weeks after the collapse, countering
that in fact what happened was the
result of escalating fears turning into

a loss of confidence, that ultimately

becoming a real threat to Lehmans viability in a way that fundamental credit
analysis could not have anticipated.
However, analysis may not have relied
so much on the numbers as on a longstanding reputation as a successful
high-flier. Credit analyst Ann Rutledge,
a principal at R&R Consulting in New
York, recalls that even back in the 90s,
Lehman had a reputation for taking
outsized risks. Rutledge, a Moody Rating Agency analyst at the time, says she
knew that in certain investment areas,
Lehman had a reputation for maintaining extremely aggressive positions.
Some critics of the rating agency
system have charged that the agencies
have a vested interest in giving good
ratings, because they are paid by the
issuer. However, even aside from the
potential of such conflicts of interest
at the rating agency, it is often not that
easy to get the right information out of
a company when the managers or promoters are determined to keep information to themselves. There are many
ways for executives to avoid answering
even direct questions, citing confidentiality, regulations, or competition,

COVER STORY
according to Niren Shah, an analyst for
the Mumbai branch of Kroll, the global
investigation service.
As an equity analyst for another firm
in May 2008, he recalls a presentation
where analysts, acting on a rumour
about an American hedge fund report
about Satyam, asked company executives again and again about the companys cash position and were repeatedly rebuffed.
In fact, financial information is often
so problematic that Kroll investigator Richard Dailly advises prospective
investors to look elsewhere. One of
the things that we tell our clients when
they ask us to assess companies is that
it is much better to spend money investigating the person running the company than investigating the companys
accounts, he says.

THE BIG PUZZLE

The last elements of the financial circus
are perhaps the most vital of all in this
circus the equity holders and lenders.
Why do they make such risky bets?
The reason shareholders take risks is
easy -- they gain if a company takes on
an outside risk and wins. What is much
more puzzling to Lawrence White, a professor of finance at New York Universitys
Stern School of Business, is why sophisticated, institutional lenders kept on lending to such a highly leveraged enterprise
as Lehman Brothers, which before its dissolution was operating at 33-1 leverage,
not counting $50bn in off-balance sheet
debt disclosed after the collapse.
I have not seen any satisfactory
answer to that puzzle other than that
this was just indicative of the whole era
that there was an under-appreciation
of risk, an excessive belief that nothing
could go wrong, White says.
Again, Rutledge points to the investment banks long track record: Lehman Brothers had been in business for
over 120 years, and succeeded with
plenty of big bets before they made a
fatal decision to pile up on sub-prime
mortgage paper.

Until we start to look at

the credit exposures of all
these institutions on a more
continious basis, we wont be
able to eliminate the bubble.
ANN RUTLEDGE, PRINCIPAL AT R&R CONSULTING,
NEW YORK

COMING ATTRACTIONS
High-profile collapses tend to lead,
rationally enough, to new regulation.
But opinion is divided about whether
the new rules will work.
Rutledge, for one, is suspicious of
Dodd-Frank, whose new rules, she says,
do not really address the essential problem of measuring credit risk. Until
we start to look at the credit exposure
of all these institutions on a more continuous basis, we will not be able to
eliminate the bubbles, she says. Massive credit exposures are traded every
day, she says, but the accounting still
reflects only a moment at the end of the
quarter, making it impossible for inves-

The reason
shareholders
take risks
is easy --
they gain if
a company
takes on an
outside risk
and wins

tors and lenders to see the true state

of affairs. You are just never going to
be able to monitor the buildup of risk,
ever, she stresses.
In India, the slowly simmering
Companies Bill is also getting mixed
reviews. Dutta is optimistic that the
bill will help improve governance,
through such measures as mandatory
rotation of auditors. Khanna wants the
proposal to strengthen audit committee rights, and for creating the possibility of suing companies on a classaction basis, which he believes would
help protect minority shareholders
against majority abuse.
Others arent as optimistic about the
bill, or indeed about the prospect of
regulatory change being truly transformational for Indian businesses, except
perhaps by opening up the possibility of hostile takeovers, and the liberalisation of those older industries still
somewhat protected from competition
through licensing, such as power, infrastructure, and mining.
Although better rules and more skeptical investors and lenders may limit
the risk of another Satyam, Dailly and
Shah of Kroll believe that what will
really make the biggest difference for
governance in India is generational
change, as an increasing number of
companies gain executives with international experience and awareness of
the importance of compliance, and the
old guard retires.
JANUARY 2011

CFO INDIA

25

CFO

PROFILE BHASWAR MUKHERJEE

DIRECTOR FINANCE, HINDUSTAN PETROLEUM CORPORATION LIMITED

Fuelling
Hopes

the

Nation

Over 31 years ago Bhaswar Mukherjee

joined HPCL as an accounts officer.
Today as Director-Finance of the same
Fortune 500 company that is eyeing a
250 per cent growth over the next five
years, Mukherjee is excited to be in
the thick of things. He talks about the
challenges and the lessons learnt over
the years and the exciting future that
awaits the PSU.
DHIMAN CHATTOPADHYAY

26

CFO INDIA

JANUARY 2011

HE WAS BORN in Balasore, a few miles away

from Chandipur, the coastal town in Orissa
now famous for Indias missile testing programme. But Bhaswar Mukherjee insists he
has nothing to do with rockets and jet planes
- other than running a company that sells them
fuel! In fact most of his adult life has been
spent dealing with fuel. Mukherjee has just
completed 31 years at Hindustan Petroleum
Corporation Limited.
The Director-Finance of HPCL loves a good
joke and is a quintessential Bengali who loves
his food, is a voracious reader and never misses
a chance to visit Kolkata during Durga Puja!
Yet this description in a way, would only be
half the story. For it does not talk about the
astute finance professional, the able leader and
the great team man that he is. Mukherjee, as
director finance has steered HPCL through the
despairing economic crisis of 2008-09, leading his team of men and women to achieve a
mini miracle when the company bounced back
from a Rs 4500 crore loss in Q3 of the fiscal,

JITEN GANDHI

of a

CFO PROFILE

MILESTONES
FIRST JOB
With PwC in
Mumbai just after I
became a Chartered
Accountant
BIG BREAK
When I had
joined HPCL in
1979
A HA! MOMENT
When we managed to turn around
the companys
fortunes within
three short months,
after a terrible Q3 in
2008-09.
LITTLE KNOWN
FACT:
I enjoy watching
theatre and listening to old Bengali
songs
DREAM
To see HPCL
achieve complete
self-sufficiency by
2016
JANUARY 2011

CFO INDIA

27

CFO
PROFILE

to being profitable once more by the very next

quarter! Today, he is in the thick of things as
HPCL launches an unprecedented expansion
plan in order to produce over 40 million tonnes
of fuel by 2016.
We moved to Kolkata a few months after I
was born and I spent my formative years there,
attending school, college and the CA course
from the city, says Mukherjee as we make ourselves comfortable in his office a cabin almost
as large (if not larger) than most of Mumbais
famed tiny 1bhk apartments.
This is an office Mukherjee has worked hard
to reach. After completing his CA in 1978, he
worked for a year at PwC a job which also
brought him to Mumbai. A year later, in 1979,
he joined HPCL a love affair that continues
to this day. In the past three decades, Mukherjee has worked across functions and in almost
every area of finance. Marketing, internal audit
and even HR - he has done it all.
Among his big breaks he lists his move to
Mangalore Refinery and Petrochemicals Ltd in
1997, where he developed systems and processes for the company. In those days, MRPL was a
JV between HPCL and the AV Birla group. This
was a great opportunity for me to learn about
setting up processes and also work closely with
one of Indias largest private conglomerates,
recalls Mukherjee.
The coffee arrives at this point and Mukherjee becomes nostalgic once more. Some of
the most enjoyable years of my life however,
he says, came shortly afterwards in 2001,
when I moved out of finance for six years, to
become head of HR for the company. The
new role made him look at things differently.
I was looking at the company as a whole. It
was during this time that we rolled out the
Balanced Score Card system only the second
firm after the Taj Group to implement this
system, whereby all employees are given clear
guidelines and targets and their score card
is reviewed by the management at the end of
every quarter, he says. Mukherjee believes
every manager should spend a few years outside his or her comfort zone to get a holistic
view of a business.
His own stint as the head of HR, however,
ended when he took over as director-finance
in February 2008. It meant an elevation to
28

CFO INDIA

JANUARY 2011

FAVOURITE

PICKS

NEWSPAPERS
TOI/ET/Ananda Bazaar
Patrika
MAGAZINES
HBR/ The Economist
MUSIC
Songs by Hemanta
Mukherjee and Manna
De
MOVIE
Satyajit Rays Pather
Panchali
BOOK
Many. I am a voracious
reader

MUKHERJEE ENJOYS WATCHING HINDI FILMS, LISTENING TO OLD BENGALI SONGS AND READING
WHATEVER HE CAN LAY HIS HANDS ON

DESTINATION
London
BELIEF
Be curious. A curious
mind learns new things
everyday

the Board as well, a well-deserved recognition

of his calibre and track record. And, almost
on cue, a few months after he took over the
finance function, the global economic crisis
broke out. It affected the company as well and
HPCL suffered a Rs 4500 crore loss in Q3 of
2008-09. This was when Mukherjee and his
team stood firm and turned the tide. We

CFO
PROFILE

What is important is the future. We are

planning investments to the tune of
Rs 50,000 crore over the next five to six years
to expand refineries and launch new ones.

bounced back in the next quarter and

made a profit. It was no mean achievement, he says modestly.
The 2009-10 fiscal too has been tough
for HPCL. We are a Rs 1,08,000 crore
company, yet our profits last year were
a mere Rs 1300 crore. It is simply not
enough, he says. His focus, though, is
clearly on tomorrow. What is important is the future. We are planning
investments to the tune of Rs 50,000
crore over the next five to six years.
We have everything sorted out the
financing, the projects and even the
deadlines. We will be expanding our
refinery in Vizag, launching a greenfield project in Maharashtra and planning a few other projects as well. We

need to plug the gap between domestic

supply (16 million tonnes) and demand
(24 million tonnes) that exists today,
says Mukherjee. That the finance team
will have to play a crucial role in this
entire excerise is not lost on him and
he has already identified key areas his
team needs to focus on. Liquidity is a
problem, because we get government
funds only in fits and starts towards the
end of the financial year. So, treasury
management is crucial, he says.
His hands are indeed full, but the
57-year-old still finds time to indulge
in his hobbies. He enjoys watching
Hindi films, listening to old Bengali
songs and reading whatever he can lay
his hands on.

Kolkata, of course, remains one of

his favourite cities to visit. So, now
that his children are settled (his
daughter is an engineer and an MBA
and his son is doing his MBA) do he
and his wife plan to go back to Kolkata
post retirement?
Its still some years away. I am not
even thinking about it. There is so
much left to do at HPCL, so much to
achieve and aspire for, says Mukherjee. There is no doubt that it is this zeal
and enthusiasm of a 25-year-old that
has not just kept him going so long
but has made him such a successful
finance professional. There is perhaps
a lesson or two that aspiring CFOs may
learn from his story.
JANUARY 2011

CFO INDIA

29

INSIGHT

GROWTH PANGS

HOW THE GROWTH OF

EMERGING MARKETS WILL
STRAIN GLOBAL FINANCE
Surging demand for capital, led by developing economies, could put
upward pressure on interest rates and crowd out some investment.

PHOTOS.COM

RICHARD DOBBS, SUSAN LUND, AND ANDREAS SCHREINER

hort-term doldrums
aside, the worlds corporations would
seem to be in a strong position to grow
as the global economy recovers. They
enjoy healthy cash balances, with $3.8
trillion in cash holdings at the end of
2009, and they have access to cheap capital, with real long-term interest rates
languishing near 1.5 percent. Indeed,
as developing economies continue to
pick up the pace of urbanisation, the
prognosis for companies that can tap
into that growth over the next decade
looks promising.
Yet all those new roads, ports, water and
power systems, and other kinds of public
infrastructureand the many companies
building new plants and buying machinerymay put unexpected strains on the
global financial system. The McKinsey
Global Institutes (MGI) recent analysis
finds that by 2030, the worlds supply of
capitalthat is, its willingness to save
will fall short of its demand for capital, or
the desired level of investment needed to
finance all those projects.
Indeed, household saving rates have
generally declined in mature econo30

CFO INDIA

JANUARY 2011

mies for nearly three decades, and

an ageing population seems unlikely
to reverse that trend. Chinas efforts
to rebalance its economy toward
increased consumption will reduce
global saving as well.
The gap between the worlds supply
of, and demand for, capital to invest
could put upward pressure on real
interest rates, crowd out some investment, and potentially act as a drag on
growth. Moreover, as patterns of global
saving and investment shift, capital
flows between countries will likely
change course, requiring new channels of financial intermediation and
policy intervention. These findings have
important implications for business
executives, investors, government policy
makers, and financial institutions alike.

SURGING DEMAND FOR CAPITAL

Several economic periods in history
have required massive investment in
physical assets such as infrastructure,
factories, and housing. These eras
include the industrial revolution and
the postWorld War II reconstruction

of Europe and Japan. We are now at

the beginning of another investment
boom, this time fuelled by rapid growth
in emerging markets.
Across Africa, Asia, and Latin
America, the demand for new homes,
transport systems, water systems, factories, offices, hospitals, schools, and
shopping centres has already caused
investment to jump. The global investment rate increased from a recent low
of 20.8 percent of GDP in 2002 to 23.7
percent in 2008 but then dipped again
during the global recession of 2009.
The increase from 2002 through 2008
resulted primarily from the very high
investment rates in China and India but
reflected higher rates in other emerging
markets as well. Considering the very
low levels of physical-capital stock these
economies have accumulated, our analysis suggests that high investment rates
could continue for decades.
In several scenarios of economic
growth, we project that global investment demand could exceed 25 percent of
GDP by 2030. To support growth in line
with the forecasters consensus, global

INSIGHT

The McKinsey
Global
Institutes
analysis finds
that by 2030,
the worlds
supply of capital
will fall short of
its demand for
capital.
particularly large in transportation (for
instance, roads, airports, and railways),
followed by power and water systems.
We project global investment demand
of about $4 trillion in infrastructure
and $5 trillion in residential real estate
in 2030, if the global economy grows in
line with the consensus of forecasters.

investment will amount to $24 trillion in

2030, compared with about $11 trillion
in 20083 (Exhibit 1). When we examine
alternative growth scenarios, we find that
investment will still increase from current levels, though less so in the event of
slower global GDP growth.
The mix of global investment will
shift as emerging-market economies
grow. When mature economies invest,
they are largely upgrading their capital
stock: factories replace old machinery

with more efficient equipment, and

people make home improvements.
But the coming investment boom will
involve relatively more investment
in infrastructure and residential real
estate. Consider the fact that emerging economies already invest in infrastructure at a rate more than two times
higher than that of mature economies
(5.7 percent of GDP versus 2.8 percent,
respectively, in 2008). The gap exists in
all categories of infrastructure but is

A DECLINE IN SAVINGS
The capital needed to finance this investment comes from the worlds savings.
Over the three decades or so ending in
2002, the global saving rate (saving as
a share of GDP) fell, driven mainly by
a sharp decline in household saving in
mature countries. The global rate has
increased since then, from 20.5 percent
of GDP in 2002 to 24 percent in 2008, as
household saving rebounded in mature
economies and many of the developing
countries with the highest ratesparticularly Chinahave come to account
for a growing share of world GDP. Our
analysis suggests, however, that the
global saving rate is not likely to rise in
the decades ahead, as a result of several
structural shifts in the world economy.
JANUARY 2011

CFO INDIA

31

INSIGHT
Exhibit 1

In 2030, global demand for investment

is expected to reach $24 trillion.
Global investment 1 for selected years, $ trillion
Compound annual growth
rate (CAGR), %

24.0
4.9

1981 2008

3.7

200830
projected

Residential real estate

3.8

3.8

Infrastructure

3.3

4.0

3.0

3.7

10.7
2.1
1.6
0.8
0.7

15.4

4.6

Other productive investment

eg, commercial buildings, factories, and machinery

7.0
3.1
1981

2008

2030
projected

At constant 2005 prices and exchange rates; forecast assumes price of capital goods
increases at same rate as other goods and assumes no change in inventory.

Source: Economist Intelligence Unit; Global Insight; Oxford Economics; World Development Indicators, World Bank; McKinsey Global Institute analysis

First, Chinas saving rate will probably decline as it rebalances its economy
so that domestic consumption plays a
greater role. In 2008, China surpassed
the United States as the worlds largest saver, with the national saving rate
reaching over 50 percent of GDP. But
if China follows the historical experience of other countries, its saving rate
will decline over time as the country
grows richer, as happened in Japan,
South Korea, Taiwan, and other economies (Exhibit 2). It is unclear when
this process will begin, but already the
countrys leaders have started to adopt
policies that will increase consumption and reduce saving. If China succeeds at increasing consumption, it
would reduce the 2030 global saving
rate by around two percentage points
compared with 2007 levelsor about
$2 trillion less than China would have
accumulated by 2030 at current rates.
32

CFO INDIA

JANUARY 2011

Moreover, expenditures related to

ageing populations will increasingly
reduce global saving. By 2030, the proportion of the population over the age
of 60 will reach record levels around
the world. The cost of providing health
care, pensions, and other services will
rise along with the ranks of the elderly.
Recent research suggests that spending
for the retired could increase by about
3.5 percentage points of global GDP by
2030. All of this additional consumption will lower global saving, either
through larger government deficits or
lower household and corporate saving.
Sceptics may point out that households in the United States and the
United Kingdom have been saving at
higher rates since the 2008 financial
crisis, especially through paying down
debt. In the United States, household
saving rose to 6.6 percent of GDP in
the second quarter of 2010, from 2.8

percent in the third quarter of 2005. In

the United Kingdom, saving rose from
1.4 percent of GDP in 2007 to 4.5 percent in the first half of 2010. But even if
these rates persist for two decades, they
would increase the global saving rate by
just one percentage point in 2030not
enough to offset the impact of increased
consumption in China and of ageing.
Together, these trends mean that if
the consensus forecasts of GDP growth
are borne out, the global supply of savings will be around 23 percent of GDP
by 2030, falling short of global investment demand by $2.4 trillion. This
gap could slow global GDP growth by
around one percentage point a year.
Whats more, sensitivity analysis of several scenarios suggests that a similar
gap occurs even if Chinas and Indias
GDP growth slows, the world economy
recovers more slowly than expected
from the global financial crisis, or other

INSIGHT
plausible possibilities transpire, such as
exchange-rate appreciation in emerging
markets or significant global investment
to combat and adapt to climate change.

IMPLICATIONS
Our analysis has important implications for both business leaders and policy makers. Businesses and investors
will have to adapt to a new era in which
capital costs are higher and emerging
markets account for most of the worlds
saving and investment.
Governments will play a vital role in
setting the rules and creating the conditions that could facilitate this transition.
HIGHER CAPITAL COSTS
Nominal and real interest rates are currently at 30-year lows, but both are likely
to rise in coming years. If real long-term

interest rates returned to their 40-year

average, they would rise by about 150
basis points from the level seen in the
autumn of 2010. The growing imbalance between the supply of savings and
the demand for investment capital will
be significant by 2020. However, real
long-term ratessuch as the real yield
on a ten-year bondcould start rising
even within the next five years as investors anticipate this structural shift. Furthermore, the move upward isnt likely
to be a one-time adjustment, since the
projected gap between the demand for
and the supply of capital widens continuously from 2020 through 2030.
Capital costs could easily go even
higher. Real interest rates can also
include a risk premium to compensate
investors for the possibility that inflation might increase more than expect-

ed. History shows that real interest

rates rise when investors worry about
the possibility of unexpected spikes in
inflation. Today, investors are beginning
to anticipate higher inflation resulting
from expansive monetary policies that
major governments have pursued.
Finally, as the recent crisis demonstrated, short-term capital isnt always available in a capital-constrained world. Companies should seek more stable (though
also more expensive) sources of funding,
reversing the trend toward the increasing
use of short-term debt over the past two
decades. The portion of all debt issued for
maturities of less than one year rose from
23 percent in the first half of the 1990s to
47 percent in the second half of the 2000s.
Financing long-term corporate investments through short-term funding will
be riskier in the new world, compared

Exhibit 2

Historically, as countries grow wealthi-

er their household saving rates decline.
Household saving rate and GDP per capita for selected countries, 19602008
Saving rate, % of disposable
personal income

40

China

35

Taiwan

30
25

Japan

India

20
15

Germany

10
5

United States

South
Korea

0
5
0

10

15

20

25

30

35

40

45

Real GDP per capita,1

$ thousand

At constant 2005 prices and exchange rates.

Source: Bank of Japan, Bank of Korea; Directorate-General Budget Accounting and Statistics, Republic of China; Global Insight; Reserve Bank
of India; World Development Indicators, World Bank; US Bureau of Economic Analysis; McKinsey Global Institute analysis
1

JANUARY 2011

CFO INDIA

33

INSIGHT
Exhibit 3

Even if investment demand slows, the

supply of savings still falls short.

Global investment demand and saving rate as % of global GDP

2030 scenarios
Consensus global
growth

Global demand for investment

Global saving rate
2030 savings shortfall

$2.4 trillion

Slower long-term
growth in China
and India

Weak global
recovery

25.1

23.7

23.6

22.6

21.3

22.7

$2.2 trillion

$0.8 trillion

Source: Economist Intelligence Unit; Global Insight; Oxford Economics; World Development Indicators,
World Bank; McKinsey Global Institute analysis

with financing through equity and longer-term funding. To better align incentives, boards should revisit some of
their inadvertent debt-oriented biases,
such as using earnings per share (EPS)
as a performance metric.

CHANGING BUSINESS MODELS

If capital costs increase, companies
with higher capital productivity
greater output per dollar investedwill
enjoy more strategic flexibility because
they require less capital to finance their
growth. Companies with direct and
privileged sources of financing will also
have a clear competitive advantage. Traditionally, this approach meant nurturing relationships with major financial
institutions in financial hubs such as
London, New York, and Tokyo. In the
future, it might also mean building ties

with additional sources of capital, such

as sovereign-wealth funds, pension
funds, and other financial institutions
from countries with high saving rates.
Moreover, for companies whose
business models rely on cheap capital,
an increase in real long-term interest rates would significantly reduce
their profitability, if not undermine
their operations. The financing and
leasing arms of consumer-durables
companies, for example, would find
it increasingly difficult to achieve the
high returns of the recent past as the
cost of funding increases. Companies
whose sales depend on easily available
consumer credit would find growth
harder to achieve.

SHIFTING INVESTOR STRATEGIES

Investors will want to rethink some of

Recent research suggests taht

spending for the retired could
increase by 3.5 percentage points
of global GDP by 2030, lowering
global saving.
34

CFO INDIA

JANUARY 2011

their strategies as real long-term interest rates rise. In the short term, any
increase in interest rates will mean
losses for current bondholders. But
over the longer term, higher real rates
will enable investors to earn better
returns from fixed-income investments
than they have in the years of cheap
capital. This change could shift some
investment portfolios back to traditional fixed-income instruments and
deposits and away from equities and
alternative investments.
For pension funds, insurers, endowments, and other institutional investors with multi-decade liabilities, the
worlds growing infrastructure investment could be an attractive opportunity.
Many of these institutions, however,
will need to improve their governance
and incentive structures, reducing
pressure to meet quarterly or annual
performance benchmarks based on
mark-to-market accounting and allowing managers to focus on longer-term
returns. This change would be required
as institutions come to manage portfolios with a growing proportion of less
liquid, long-term investments, since volatility in market prices may reflect market liquidity conditions rather than an

INSIGHT
investments intrinsic, long-term value.
Emerging markets, though they may
present attractive opportunities, also
pose many risks and complexities, and
returns could vary significantly across
countries. As incomes in emerging
markets rise and capital markets develop, non-financial businesses can expect
healthy growth from investing in both
physical and financial assets. Returns
to financial investors are less certain,
however, particularly in countries
with low returns on capital or savings
trapped in domestic markets by capital controls or a home bias among
domestic savers and investors. These
countries will remain susceptible to
bubbles in equity, real-estate, and other
asset markets, with valuations exceeding intrinsic levels. Foreign investors
will need to assess valuations carefully
before committing their capital. They
will also have to take a long-term perspective, since volatility in these bubble-prone markets may remain higher
than it is in the developed world.

A CALL FOR GOVERNMENT ACTION

Governments will need to encourage
the flow of capital from the worlds savers to places where it can be invested in
productive ways while minimising the
risks inherent in closely intertwined
global capital markets. Governments in
countries with mature markets should
encourage more saving and domestic
investment, rebalancing their economies so they depend less on consumption to fuel growth. Policy makers in
these countries, particularly the United
Kingdom and the United States, should
start by putting in place mechanisms to
sustain recent increases in household
saving. They could, for instance, implement policies that encourage workers
to increase their contributions to saving plans, enrol in pension plans, and
work longer than the current retirement age. Further, governments can
themselves contribute to gross national
savings by cutting expenditures.
To replace consumption as an engine
of economic growth, governments

In emerging economies, govern-

ments should promote the con-
tinued development of deep and
stable financial markets that can
effectively gather national savings
and channel funds to the most
productive investments.
in these countries also should adopt
measures aimed at boosting domestic
investment. They could, for example,
provide accelerated tax depreciation
for corporations, as well as greater
clarity on carbon pricingthe current
uncertainty is holding back clean-tech
investment. They should also address
their own infrastructure-investment
backlog, although this could require
them to revise government accounting
methods that treat investment and consumption in the same way.
In emerging economies, governments should promote the continued
development of deep and stable financial markets that can effectively gather
national savings and channel funds
to the most productive investments.
Today, the financial systems in emerging markets generally have a limited
capacity to allocate savings to users
of capital. We see this in these countries low level of financial depthor
the value of domestic equities, bonds,
and bank deposits as a percentage of
GDP. Policy makers should also create incentives to extend banking and
other financial services to the entire
population.
At the same time, policy makers
around the world should create the
conditions to promote long-term funding and avoid financial-protectionist
measures that obstruct the flow of
capital. This will require removing
constraints on cross-border investing,
whether through restrictions on pension funds and other investors or on
capital accounts. Policy makers must

also create the governance and incentives that enable managers of investment funds with long-term liabilities,
such as pension funds, insurance companies, and sovereign-wealth funds,
to focus on long-term returns and not
on quarterly results that reflect market
movements and can deviate from longterm valuations.
At this writing, global investment
already appears to be rebounding from
the 2009 recession. The outlook for
global saving is less certain. A climate
of costlier credit will test the entire
global economy and could dampen
future growth. The challenge for leaders will be to address the current economic malaise and simultaneously create the conditions for robust long-term
growth for years to come.
RICHARD DOBBS IS A DIRECTOR OF
THE MCKINSEY GLOBAL INSTITUTE
(MGI) AND A PARTNER IN MCKINSEYS SEOUL OFFICE, SUSAN LUND
IS DIRECTOR OF RESEARCH AT MGI,
AND ANDREAS SCHREINER IS A CONSULTANT IN THE NEW YORK OFFICE.
THIS ARTICLE IS ADAPTED FROM
FAREWELL TO CHEAP CAPITAL?
THE IMPLICATIONS OF LONG-TERM
SHIFTS IN GLOBAL INVESTMENT
AND SAVING, AVAILABLE ON THE
MCKINSEY & COMPANY WEB SITE,
WHERE YOU MAY ALSO DOWNLOAD
THE REPORT AS AN EBOOK (BOTH
EPUB AND AMAZON KINDLE FORMATS OFFERED). COPYRIGHT 2010
MCKINSEY & COMPANY. ALL RIGHTS
RESERVED.
JANUARY 2011

CFO INDIA

35

IN PRACTICE

OPINION

CORPORATE ETHICS
A CASE OF THE DEVIL
QUOTING THE SCRIPTURES
A self-confessed capitalist flings stones from his
glass abode at the Scrooges who run businesses.
NAWSHIR MIRZA

et me not beat about the

bush. Corporate ethics is an oxymoron a contradiction in terms. A corporation is, by instinct and purpose, a
ruthless buccaneer in whose philosophy true ethics can find no place. How
ethical was the conduct of the following
corporations?
Union Carbide India continued to run
a production process that used highly poisonous gas in a location that had become
surrounded by shanties, albeit illegal.
Certain financial institutions risked
their depositors and shareholders funds
in high risk products that no one understood, while their managements awarded
themselves enormous bonuses for imaginary profits earned.
Some bottled water businesses
brain-wash people into believing
that drinking safe tap water is cheap,
shameful behaviour.
Certain cigarette businesses advertised the virtues of smoking to new mothers, claiming that it burns the fat accumulated during pregnancy.
Two stand-alone and wholly profit36

CFO INDIA

JANUARY 2011

able businesses that merge with the sole

purpose of reducing manpower, thereby
putting people out of employment with
the sole object of making the holders of
equity in those businesses even wealthier.
Businesses mine minerals in pristine forest areas knowing well that the
flora and fauna destroyed can never be
replaced.
The list can be endless. The fact is
there are few corporations that can
claim ethical conduct when they adopt
practices or policies that are not considerate towards stakeholders other than
the providers of risk-based capital. Business managers and finance officers in
corporations are trained to believe that
in the ultimate analysis, every business

decision must pass the test of enhancing shareholder value. Even CSR decisions must be justified on this ground.
If there is a conflict between the interests of providers of equity and any other
stakeholders in a business, the former
will inevitably win.
The capitalist system has conveniently
reduced the definition of ethics to not
paying bribes and not consciously violating the laws. Marginal doubts (and often
not-so marginal ones) of compliance are
resolved by asking lawyers for opinions
that justify adoption of a practice which
violates the spirit (and in many cases the
letter) of the law. I recall having a meeting
with the Global Director of Ethics of one
of the worlds largest companies whose

There are few corporations that

can claim ethical conduct when
they adopt practices or policies
that are not considerate towards
stakeholders...

PHOTOS.COM

IN PRACTICE

definition of bribes was money paid for

securing an illegal advantage but excluded speed-money, paid for securing more
quickly than normal, an approval that the
corporation was legally entitled to.
The recent exposures of corruption in
Delhis government are startling not so
much because they happened. Indian
corporations have been bribing ministers
and bureaucrats in Delhi since Indias
independence. But those bribes were to
secure favours in violation of policy; e.g.,
import licences to which they were not
entitled. The current ones are shocking
because the bribes now being paid are
with the intent to subvert the policy itself
or to determine what it should be; e.g.,
to decide if there should be go and no-go
areas in mining or policy determining the consideration for which scarce
national resources, owned by the government, are transferred to their capitalist

exploiters. Ratan Tata feared that we were

becoming a banana republic. Indeed, we
have been one for many years already.
Returning once again to the main
theme of this article, corporations cannot be ethical when their business practices involve the following:
Exploiting stakeholders to the maximum so as to earn super profits for the
providers of equity.
Creating demand for an unnecessary product.
Increasing the consumption of a product by building-in physical obsolescence
or by making buyers believe that they
must upgrade to the next version.
Sacrificing, for the purpose of the
business, the natural world.
The system has kept the measures
of success, value and growth limited to
financial ones GDP, revenues, profits,
cash flows, net worth and ratios based

on these. But a reaction is beginning to

take place. At a national level the King
of Bhutan, in 1972, said he wanted to
measure Gross National Happiness. His
comment was received with derision in
economist circles. It took a global recession for the capitalist countries to finally
acknowledge that happiness cannot be
equated with wealth, that there are many
more factors that go into it. The French
Joseph Stiglitz Commission in 2008 and,
recently, the David Cameron government
have made happiness an important measure of national success.
At a corporate level it is slowly, too slowly I am afraid, finding acceptance as well.
Triple bottom lines, the Global Reporting
Initiative, The Malcolm Baldrige model
(internalised in the Tata Group as the Tata
Business Excellence Model) are examples
of responsible, ethical corporations recognising the need for measuring success in
more ways than purely financial. Even
these companies may fail on the touchstone of their products or businesses
damaging the long term environment.
Indeed, in some cases these very measures have been adopted by companies
that deal in products such as cigarettes or
hedonistic luxuries a classic case of the
devil dealing with the scriptures.
If corporations are to become ethical,
they need to measure the net value they
create for all stakeholders combined. To
do this, every decision will need to be justified on that measure. Along with IRR and
NPV, project decisions should involve the
board studying the Environmental Impact
Assessment report. Annual and quarterly
reports should cover all stakeholder value
creation minus destruction. Indeed, so
radical is the change needed in the system
that we are unlikely to see it happen in our
lifetimes. Till then, the rest of the world
(outside of company boardrooms) will
continue treating the phrase Corporate
Ethics with the same hilarity as it does
that classic example of an oxymoron
military intelligence.
The author is President, Institute of Internal
Auditors, Calcutta and Indo-American
Chamber of Commerce, Western India.
JANUARY 2011

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37

IN PRACTICE

RISK MANAGEMENT

WHY RISK FAILURES

OCCUR AND HOW TO
PREVENT THEM
Did Toyota and BP lack the resources to minimise recent hits to
their reputations? Certainly not. But successful risk mitigation
often requires something more than conventional tools: A nextgeneration solution.
WILLIAM S. BOJAN JR

ost risk management failures arent the result of

a lack of available risk management
models, approaches, methodologies,
processes or tools. In many cases, it is
not about spending more. Significant
investments have been made by many
organisations as part of their conventional risk management foundation,
including infrastructure, risk identification, assessment, management, monitoring and reporting.
Yet conventional approaches to risk
management are no match for the
complexities of todays marketplace.
That foundation is insufficient to produce appropriate protection and value
for the organisation in the area of risk
management.
Most failures are rooted in the lack
of robust execution weaknesses in
coordination (overlooking key risks and
their interdependencies), collaboration
(untapped value creation and connection with key management processes)
and integration (deficient linkage
38

CFO INDIA

JANUARY 2011

among monitoring disciplines and a

bridge for board risk oversight). The
solution to preventing and reducing
these failures is to improve the execution, including linkage to the organisations corporate governance. The roles
of execution and integration cannot
be overemphasised.
Financial executives need an effective roadmap to better risk management execution, the how-to that is
so often missing in the dialogue about
risk management. The next generation
of risk management must integrate
the key dimensions of coordination,
collaboration and integration with the

organisations business processes, and

help it achieve improved corporate
governance as well.
Next-generation corporate governance can be viewed as the new standard necessary to restore trust in an
increasingly challenging and complex environment.

APPROPRIATE ROLE OF
RISK MANAGEMENT
In a healthy organisation, a triad exists
in the form of checks and balances
among senior management, the board
of directors and risk management. This

Next-generation corporate gover-

nance can be viewed as the new
standard necessary to restore
trust in an increasingly challeng-
ing and complex environment.

triad is analogous to the three branches

of the United States government: The
board of directors, as the legislative
branch, establishes and oversees compliance with the rules regarding the
organisations corporate governance.
Senior management is the executive branch, carrying out those rules,
while risk management, as the judicial branch, monitors and reports on
the appropriate execution of the rules.
When the power within the triad is balanced, the checks and balances function is in a healthy position and risk can
be managed appropriately.
When the role of risk management is
diminished within the triad, the organi-

sations sustainability is jeopardised

because the process for speaking the
truth about risks to the organisations
health has been stifled.
This can lead to the types of problems
that have surfaced with American International Group Inc., Toyota Motor Co.
and British Petroleum Inc., among others. There is significant value that risk
management as monitor and reporter can provide an organisation. An
organisation will realise an enhanced
return on its risk management investment when it embraces and executes
on these next-generation dimensions
and elements, in addition to its existing
foundation described above:

Coordination: Understanding exposure.

Addressing all aspects of risk.

Understanding risk interdependencies.
Collaboration: Driving engagement.
Facilitating value creation across the
organisation.
Connecting to key management processes.
Integration: Viewing holistically.

Linking to other key monitoring disciplines.
Bridging to board risk oversight.
Table 1, Risk Operating Model,
illustrates the foregoing dimensions
and elements.
JANUARY 2011

CFO INDIA

39

PHOTOS.COM

IN PRACTICE

IN PRACTICE

By engaging the organisation

and understanding exposure
through consideration of
all aspects of risk, those
responsible can avoid pitfalls
and begin to add real value in
their organisations.
COORDINATION
Understanding exposure, addressing all
aspects of risk and understanding risk
interdependencies. An integrated view
of risk includes many dimensions that
must be considered, moving beyond
solely financial or insurable risk. All
dimensions of risk need to be viewed in
concert, not as separate elements.
Often, various dimensions of risk
are allocated to isolated management
and board groups for management
and oversight responsibilities. The

danger in viewing risk in such

a disaggregated manner is that
interrelationships among these risks
can be lost and the real exposure not
well understood.
Indeed, issues such as the current
economic crisis have real impact on
growth, products and operations. Considering issues only for their impact on
financial performance or compliance
will inhibit effective decision-making.
It is also important to adopt a common language encompassing all rel-

Risk Operating Model

evant aspects of risk that can be utilised

across the organisation to identify,
assess and manage key risks. Think of
it as the organisations universe of risk.
Each of these elements could become
an organisations Achilles heel, and a
careful review of each element should
be on the agenda. Questions such
as what could go wrong and what
would be the impact? should be asked.
By engaging the organisation and
understanding exposure through consideration of all aspects of risk, those
responsible for risk management can
avoid pitfalls and begin to add real value
in their organisations.

COLLABORATION
Driving engagement; facilitating
value creation across the organisation and connecting to key management processes (creating synergy). If
the entire organisation is not engaged
in the risk management discipline, it
can be a check the-box compliance
exercise that misses true risks to the
organisation at all appropriate levels.
Effective risk management must drive
business-specific value. When leaders understand the risks of their next
technology initiative, product roll-out
or acquisition integration, understanding risk becomes relevant and engagement increases.
The following activities should be key
focus areas for engaging the organisation in a discussion of risk:
Enterprise Risk Assessment which
encompasses optimising the overall control environment and delivering peace of mind to key stakeholders.
This considers both the upside and the
downside of risk and establishes and
monitors risk tolerances.
Business Plan Performance identify and manage threats to the
achievement of the business plan. Linking to strategic and business planning
provides context for meaningful risks
and linking to periodic performance
management process provides context
for risk management performance.

40

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JANUARY 2011

IN PRACTICE

Major Change Events identify

and address the risks associated
with major change events by enhancing change execution of strategies and
initiatives with higher risk profiles,
such as international expansion, new
business lines or products, process
re-engineering, technology platform
changes, off shoring, high growth
and acquisitions.
Chronic Underperforming Areas
identify and address the risks/
root causes underlying areas such as
underperforming business units, divisions, processes, initiatives, etc.
Emerging Risks identify and
m o n i t o r o v e r t h e h o r i z o n
risks to ensure they are proactively
addressed (i.e., emerging risks related
to industry, competitor, environment
and regulatory).

Linking to Other Key

Monitoring Disciplines

4
5

INTEGRATION
Viewing holistically; linking to other
key monitoring disciplines. To create
synergy for unlocking the value of
next-generation risk management
in an organisation, the dots must
be connected integration must
occur between the risk management
process and other key processes for
managing the business, such as
strategic planning. This is important
because risk and return should be
managed in conjunction with the
strategic direction of the business
and how business performance is
measured and monitored.

Typically, four primary monitoring disciplines should exist within an

organisation in addition to risk monitoring. These include ethics, social
responsibility and audit/compliance.
Each of these monitoring disciplines
supports a primary relationship with
one of the four cornerstone components of any business operating model:
The mission, vision and values, as well
as strategy, execution and controls.
(See Table 2 Linking to Other Key Monitoring Disciplines.)
Just as the organisation would not
function well if these business model

Typically, four primary

monitoring disciplines should
exist within an organisation
in addition to risk monitoring.
These include ethics, social
responsibility and audit/
compliance.

components were not well aligned

and integrated, the monitoring systems ability to check the health of the
organisation and see things whole is
also significantly constrained if these
four basic monitoring elements are not
aligned or coordinated. For example,
consider the recent sub-prime lending
crisis. Was there an ethical component
or issues around social responsibility?
Of course. More effective and integrated monitoring could have should
have identified these issues sooner.
By connecting processes and coordinating disciplines, risk leaders can align
these critical elements of an organisations success to their overall objectives.
Lets take an end-to-end view on
global risk management, from the
boardroom through implementation.
Starting with the final element of nextgeneration risk management bridging to board risk oversight governing
effectively requires strong integration
of the organisations risk management
process and reporting with the boards
responsibility for risk oversight. In
todays marketplace, this is an area of
heightened focus for businesses operJANUARY 2011

CFO INDIA

41

IN PRACTICE
ating in the United States, as well as
within the government.
The current disintegration that frequently occurs at the board level around
risk oversight often centres around one
or more of the following common pitfalls:
Poor Risk Management Information.
Lack of organizational sophistication,
competency and holistic reporting
mechanisms; and weaknesses around
risk aggregation, interdependencies
and portfolio concentrations.
Unclear Oversight Ownership.
Unclear ownership by the board of
the oversight of the organisations risk
management both the individual
components and overall.
No Assessment Mechanism. No
effective mechanisms to assess the
organisations risk management process and information quality.
Inadequate Risk Expertise. Inadequate level of deep risk management
expertise on the board (member and
advisory).
Reactionary Posture. Tendency not
to listen or respond to early warnings
of risks until it is too late to avoid crisis; this is often most prevalent when
current performance and performance
trend is favourable.
An approach that integrates board
level risk oversight with the risk management process will help organisations overcome these common pitfalls
and be leaders in risk management
effectiveness. This will help their businesses be more successful and will
quickly build and restore public trust in
business overall.
Additionally, the full board must oversee and assess the organisations overall risk management effectiveness
possibly through an appropriate board
committee, such as a risk committee.
This includes consideration of the
organisations risk profile in the aggregate, based on a holistic view of risk
oversight assignments to individual
board committees. Clear ownership and
accountability regarding the oversight of
the organisations risk management sys42

CFO INDIA

JANUARY 2011

Improving the execution of

risk management will enhance
corporate value in a variety
of ways, such as reducing or
eliminating the significant and
sometimes crippling cost of risk
management failure...
tems is critical to realising its full value.
Ownership among senior management and the board must be clear
regarding risk types, exposure (aggregation, interdependencies and portfolio
concentrations) and acceptance (in relation to an established risk appetite and
specific risk tolerances).

IMPLEMENTING NEXTGENERATION RISK MANAGEMENT

Moving to a practical implementation
strategy is often the challenge that,
unmet, becomes the downfall of wellintentioned risk management leaders in any discipline. An integrated
implementation approach will help
ensure that the leaders achieve their
objectives. It is important to build a
foundation of support, engage leaders
throughout the organisation and then
deepen and enhance the understanding of the value that integrated risk
management provides. Driving from
an overall foundation through real
integration is an effort, but certainly
important and worthwhile.
An appropriate implementation
approach begins with establishing a
foundation for risk management at
the business unit level, by developing
awareness and capability and aligning
expectations. Next, risk can be managed at that level through engagement
in specific risk issues, demonstrating
tangible value and implementing the
risk management process. Ultimately,
risk can be managed at the enterprise

level through executing on coordination, collaboration and integration as

discussed earlier.
By focusing these efforts in a phased
approach, engagement will increase,
collaboration will improve and risk
management leaders will have a powerful platform for delivering a holistic
view of the risks facing their organisation and how the organisation can
respond to those risks.
Improving the execution of risk management will enhance corporate value
in a variety of ways, including reducing or eliminating the significant and
sometimes crippling costs of risk management failure, increasing the return
on investment on the risk management
spend, helping organisations assume
risk intelligently and preserving the
reputation of the organisation, its leadership and its board.
By effectively working with their
boards, risk management leaders can
build next-generation risk management
practices that truly support the organisations success and sustainability.
WILLIAM S. BOJAN JR. (WILLIAMBOJAN@INTE GRATEDGOVERNANCE.
COM) IS PRESIDENT AND CEO OF INTEGRATED GOVERNANCE SOLUTIONS
LLC IN MINNEAPOLIS. IGS OFFERS
POWERFUL NEXT-GENERATION GOVERNANCE TOOLS TO HELP ORGANISATIONS OF ALL SIZES ACHIEVE
AND SUSTAIN HEALTH, AGILITY AND
TRUST. 2010 FINANCIAL EXECUTIVES INTERNATIONAL WWW.FINANCIALEXECUTIVES.ORG

CASE

STUDY

PROJECT MAP
THE CHALLENGE:
Raise funds for rapid expansion
TIME PERIOD:
Between January and November
2010

44

CFO INDIA

JANUARY 2011

PEOPLE INVOLVED:
Finance team and top management
KEY TAKEAWAYS:
Focus on people, avoid unnecessary bureaucracy

CASE STUDY

NEW

Scaling

Heights

Fortifying the corporate finance function to meet the

demands of rapid growth and going through two fund raising
campaigns within one year were key areas iYogis CFO
Joy Basu focused on during 2010. Here is how team iYogi
achieved their target.
DEEPAK GARG

SUBHOJIT PAUL

n October 2009, Joy Basu,

former CFO of Nasdaq listed
Rediff.com, joined the fast
growing, four-year-old, tech
support firm iYogi. He had
not anticipated the far reaching possibilities that the company was inherently
prepared for but needed fine tuning
and focused direction for growth.
With sound fundamentals for a
high growth subscription business,
Joy spent time on the growth trajectory and achieved numbers. I am a
numbers man, and that becomes the
most important criteria for evaluating
any decision, weather it is buying a car
or a new pair of shoes. Its only after I

joined the company and analysed the

numbers, that I quickly realised that the
opportunity was much larger and the
company was perfectly poised.
iYogi is the first direct-to-consumer
service brand from India. In the last few
years it has emerged as the largest independent remote tech support company
in the world. The company has grown
at a dramatic 300 per cent growth rate,
increasing tech support executives from
1,250 to 5,500 in the last 12 months,
across eight delivery locations in India.
iYogis services are currently available in
the United States, the United Kingdom,
Australia and Canada, with an expanding
footprint in the Middle East and Europe.

THE CHALLENGE
In a fast growth company like iYogi,
Basus immediate focus area was to
build on foundations laid by the founders to prepare for an even larger and
faster pace of growth. The first step he
took was to institutionalise the finance
function with streamlined processes
and a clear vision for the next five years.
I am delighted that I got a free reign,
the management had confidence in my
years of experience in managing similar functions and governance practices
for listed companies. Additionally,
there were the complexities of the business itself where there was a database
of individual subscribers from different
JANUARY 2011

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45

CASE STUDY
support iYogi and also understand the
space required for our entrepreneurial style. Basu also had to ensure that
capital raised was at the right valuation, without overly diluting value for
current shareholders. In the last two
series of raising venture capital iYogi
has raised a total of $45 million from
blue chip investors like Sequoia Capital and Draper Fisher Jurvetson. Rather than raise the entire sum in one go,
iYogi prudently opted for raising two
tranches, of $15 million and $30 million respectively and within a span of
twelve months.

THE LESSONS

To build world-class facilities

and manage recruitment and
training in a short time requires
not just large investments but a
huge amount of management
bandwidth.
countries, multiple vendors and global
marketing partnerships. To add to this
iYogi was also planning to raise successive rounds of venture financing which
required Joy to work with multiple venture funds, as there were primary and
follow-on investors.

HOW THEY DID IT

Managing such a frenetic growth
pace and making the company future
ready can be challenging and requires
strategic planning and controlled
implementation. The first steps were
to automate; to develop an ERP system
that could manage the complexity of
a business model that is subscription
based, multi geographical and
deals with multiple vendors. This is
now supported with a large finance
team. The complexity is enormous.
To build world class facilities and
manage recruitment, administration
and training for thousands of skilled
46

CFO INDIA

JANUARY 2011

employees in a short time requires

not just large investments but a huge
amount of management bandwidth.
Rather than attempt to do everything
in house we entered into carefully
planned outsourcing alliances with
leading BPO companies such as IBM
and Genpact. The key was to outsource
a select part of our service offerings
and attain a uniform level of efficiency
at multiple locations under different
management. It was a strategy which
worked out very well and today iYogi
successfully outsources approximately
40 per cent of its tech support staff,
says Basu.
And then, of course, there was the
challenge of raising the capital needed for further expansion and growth
plans. Given what we had already
achieved, getting interest from venture
capital firms was in itself not terribly
difficult says Basu. The key was to
raise capital from investors who would

According to Basu, the biggest lesson

is to focus on people rather than numbers. Before joining I had studied
the numbers carefully but no balance
sheet can foretell the future of a business. It can only tell the story of the
past and show the status at present.
In my interactions with the management I wondered about their insight
into the business. And what I found
was a sharp focus on customers and
employees, clearly enunciated goals, a
deep understanding of the opportunities and challenges and a well thought
out plan to tackle them. Add to that a
scalable, proven, technology platform
developed in-house and the neverending zeal to experiment with new
ideas, led Basu to conclude that he had
found a winner.
Basu believes that in these dynamic
times, nimble-footed management will
have a distinct edge over slower competition. Basu also feels mistakes will
happen, but what is important is the
ability to identify such mistakes early
on, take timely corrective action and to
learn from them. And while one cannot underscore the need for instituting
the right controls, which are essential
building blocks of a scaling organisation, care must be taken to avoid excessive and unnecessary bureaucracy,
which could lead to a straightjacket
situation, constricting growth and
creativity.

LEADERS

WORLD

Ethics
:
World
What We Can
Learn from the

of

Adventure

Truth, transparency, respecting best

practices and accepting responsibility
adventure sports teaches us some crucial
management lessons.
DAVID LIM

ABOUT THE AUTHOR

David Lim, Founder,
Everest Motivation Team, is
a leadership and negotiation
coach, best-selling author
and two-time Mt Everest
expedition leader. He can
be reached at his blog
http://theasiannegotiator.
wordpress.com, or david@
everestmotivation.com

48

CFO INDIA

JANUARY 2011

IN 1968, DONALD CROWHURST was part of a flotilla of yachts competing in a

round the world race. After crossing the Atlantic from the start of the race from
Britain, he began falsifying his logbook and radio transmissions to give the impression that he was doing well in the race. When his plan began to get exposed, he
could not bear it and threw himself overboard, never to been seen again. Only his
notes and papers found on his abandoned yacht revealed the true nature of his
achievement. In the 1990s, ace Slovenian climber Tomo Cesen claimed to have
solo-climbed the much-attempted and stupendously difficult 2000m high south
face of the 8500m-high Lhotse. Feted for a while, discrepancies soon arose from
studies of his photographs and other evidence. He is now discredited.
Quite a few years ago some climbers were written about in newspapers after
they claimed to have summitted Shishapangma, an 8046m peak in Tibet.
The team enjoyed accolades before their claim was challenged. It seemed
they had climbed a lower, subsidiary point along the 2km-long summit ridge
known as Shishapangma Central, and that they did not climb to the top, as
claimed in the media. In their defense, the team submitted a certificate by the
Chinese Mountaineering Association that deemed that any team that climbed

LEADERS WORLD
Shishapangma Central was considered to have
summitted the peak. This, to some, flew in face
of common wisdom if one has not climbed to
the top, then no certificate in the world, surely,
can assist you to do so after the fact.
There are some written rules in existence in
the adventure-sports world, such as the English
Channel Swimming Associations rules about
the actual amount of assistance a swimmer is
allowed to receive. In climbing, there are a few
written rules, but many unwritten ones that dictate how an ascent be categorised. Tomo Cesen
was just another climber who got caught. More
complex issues surround achievements based
on doing something in a particular style.
In order to distinguish milestones in a
sport, you need some yardstick to sort them
out according to their quality of achievement.
By doing so, you can sort out the best achievements and those who are pushing the sports
limits in terms of endeavour and skill. So climbing a challenging peak with minimal gear and
support counts for more than a standard ascent
involving porters and such aids.
However, if people do not pay heed to style
issues, such claims only serve to demean the
achievement of those dedicated to quality results
very much like how people who have earned their doctorates
feel about people who literally buy their PhDs from degree
mills with minimal academic study and challenge.
John Barnes, Australian sociologist and author of the
book, A Pack of Lies, reflects how society expects sportsmen and women to somehow aspire to higher level of existence that they are above crass commercialism and cheating. But with greater emphasis on sponsorship, money,
spectator interest and expectations have grown as well. And
so, society is disappointed when a sportsperson is found
wanting. If we can fib about not stepping on that steel bolt
to help us gain a few inches in order to complete a particular rock climbing route on a Sunday afternoon climb, what
else might we be capable of?
Ultimately, the integrity of adventure sports achievements,
done out of the glare of TV cameras, depends on the ethics
of their practitioners. There is often too great a temptation
to say we did it especially after suffering for days or weeks
for our goal. Yet, it is the stronger soul who says we nearly
made it, but for.
The beauty of sports such as mountaineering is that it
embraces all from those who find challenge in a blank
20m piece of vertical granite, to those who like to suck thin
air over 7000 metres. However, the climbing community
expects that its practitioners be completely transparent about
the style in which a challenge is achieved.

There is often too great a

temptation to say we did it
especially after suffering for
days or weeks for our goal. Yet,
it is the stronger soul who says
we nearly made it, but for.
What can we apply from the world of adventure to the corporate world? The lessons are simple:
1) Ensure your claim or achievement is beyond reproach or
doubt
2) Be absolutely transparent about how you achieved a specific
objective in the workplace
3) Respect best practices in your field of endeavour
4) You are responsible for your workplace and public
announcements
The current game of climbing the really big peaks in the
world, such as the 8850m-high Mount Everest, sees fewer
dedicated mountaineers, and more dilettantes or list-tickers
attempting it for the privilege of having said they did it. The
mountaineering world embraces all of them, although it does
expect that climbers be honest about how they did it as much
as whether or not they got to the top.
However, one rule remains: summits have to be
reached. Exceptions include certain sacred summits, like
Kanchenjunga, where for local or religious deference, one
might stop some metres from the actual top. But you can only
say you have climbed a peak like Mount Everest when you
have uh climbed it!
Reinhold Messner, the first to complete climbing all the 14
peaks in the world over 8000-metres in height, said, All the
8,000-ers have one, nothing else, and that is a main summit.
No certificate issued by any man-made organisation can say
otherwise. That is the ultimate truth.
JANUARY 2011

CFO INDIA

49

Lounge

01.11

CFO

This month drive the safest thing on four-

wheel - Volvo XC60, own the sleekest gadget
for your work station - MacBook Air, travel to the
most aesthetic destination in Europe - Florence,
experience uncustomary art by Sudharshan Shetty,
and attribute a meaning to Fault Lines in economy.

VOLVO XC60

Better Volvo than sorry

Volvo XC60 drives you around and not vice versa,
vouches Anoop Chugh
I HAD A late realisation driving Volvos bold,
sporty and muscular small, premium utility
automobile XC60. During the latter half
of the 2500-odd-km journey between New
Delhi and Mangalore via Jaipur-UdaipurAhmedabad-Surat-Mumbai-MahabaleshwarRatnagiri and Panaji, my belief that it wasnt
me driving the Scandinavian-crossover around,
grew even stronger. I felt like a child who had
been given a phony steering to make it look

50

CFO INDIA

JANUARY 2011

real. It was all a sham. This is one car that you

dont need to drive at all it drives you!

Looks
It is not often that one gets a chance to talk
about the looks of a Volvo car. Volvo reviews
generally start with safety gadgetry and ends
with it. After all, the only place safer than a
Volvo cabin is probably a Volvo cabin inside

DID YOU

KNOW?

Volvo cars are the

benchmark for
safety-on-wheels. In
1958, Volvo invented the modern
3-point safety belt.
It was the first company to produce
cars with padded
dashboards. Additionally, it developed
the first rear-facing
child seat in 1964.

CFO LOUNGE

ON WHEELS
the White House. Mind you, the
XC60 is a pleasant exception to the
golden Volvo rule of Bland looking,
but safe. The XC60 will keep you
out of harms way too, but with style,
elegance and adulation.
The XC60 is, perhaps, the first Volvo ever that seems to have spent some
time in a gym. The cars shoulders
are exceptionally broad, true of a SUV
silhouette, mainly due to the clear
sculpted, seductive lines when viewed
from the side. The large wheels, the
bold wheel arches and the darker livery of the bodys lower section further
enhance the muscular feel.
Volvo has also revolutionised the interiors of the XC60. The most appealing bit about the interior is the slim
centre stack, which is made with pure
emotion and sensation as opposed
to mere intellectuality. The centre
console is slightly angled towards the
driver, leaving no doubt as to where
the best seat in the car is located. One
would have to thank Jonathan Disley
for the interior environment radiating high-tech feel and ergonomically
designed instruments. The threesection rear seat (40/20/40) can be
completely flattened to drive off on a
weekend getaway with kids.

THE MOST APPEALING BIT ABOUT THE

INTERIOR IS THE SLIM CENTRE STACK. ALSO,
THE THREE-SECTION REAR SEAT CAN BE
COMPLETELY FLATTENED .

VOLVO
XC60
Price

2400cc

Max Power

205bhp

Max Torque

420Nm

Gear Box
Wheelbase
Top speed
Cylinders
Fuel efficiency

Ride & Performance

Volvos manual is car technologys
encyclopaedia. If Volvo does not
have it, its probably not invented
yet. Not in any particular order,
the car boasts of an All Wheel
Drive (AWD) with Instant traction;
Dynamic Stability and Traction
Control (DSTC) to stabilise the car
in evasive manoeuvres; Hill Descent
Control (HDC) that automatically
controls the cars speed when driving
down steep slopes; Continuously
Controlled Chassis Concept
(FOUR-C) that makes it possible
to choose a chassis setting to suit a
certain driving style and the Trailer
Stability Assist (TSA) which can
stabilise the car and trailer. Other

Rs 39.5 lakhs

Engine

6speed GT
2815 mm
210kmph
5 in-line
10.5kmpl

Turning circle

11.9m

0-100kmph

8.9sec

POSITIVES

Safe as the White

House, surprising
good looks, aesthetic
interiors, pricing when
compared to the rivals
NEGATIVES
At times overdose of
safety features make the
drive dull and boring,
disinclined engine
VERDICT
The XC60 doesnt have
the grunt of the X3, or
the presence of the Q5,
or the pedigree of the
Freelander, but with the
premium-utility vehicle
Volvo has come closest
to the perfection.

safety mechanisms include the Driver Alert Control

that detects tired and distracted drivers; the Blind
Spot Information System (BLIS) that helps detect
vehicles in the offset rear blind spot on both sides of
the car and the Lane Departure Warning that alerts
the driver if the car runs across the lane markers
without the turn indicator being used.
At times you feel all these safety functions make the
drive a bit too safe and non-dramatic, but at least you
reach your destination safe and sound.
We only had the opportunity to drive the assiduous
D5 turbocharged diesel variant of the five engines
available. However, after driving the five-cylinder D5
engine (205 horsepower and 420 Nm) around we
were still griping for some additional punch. Call it
our insatiable greed. The D5 felt more-at-home on
NH8; but the two-lane NH17 from Mumbai dissipated
the D5s all-round capabilities. Perhaps for Indian
conditions, the new five-cylinder D3, in principle the
same engine as the well-established 2.4-litre diesel,
would have been a better choice with a shorter stroke
and lower fuel consumption.
JANUARY 2011

CFO INDIA

51

CFO LOUNGE

GIZMOS
NEW LAUNCHES

HOT SPOT

Motorola
Tablet
The Xoom, one of the first tablets
to run on Googles Android 3.0
Honeycomb OS has been unveiled
by Motorola. Specifications: Operating system: Googles Android
3.0; Dual core processor 2GHz
processing power; Price: N/A

Skin deep!
The New MacBook Air is here.
Anoop Chugh
FOR THE CONFIGURATION, the
price of almost Rs 1 lakh makes the
Macbook Air an expensive proposition. However, that discounts the fact
that it is a beautiful piece of equipment. This is one of those products
you buy when your heart rules your
head. The new Air comes in two sizes
- 11-inches and 13-inches.
The Air can be defined with the
same language one would use for
Keeley Hazell - slim and curvy in the
right places. The uni-body is still a
gorgeous piece of equipment, and the
lid and body are rigid.
The Air is also sharp-looking once
flipped open. The keypad is the same
size as the MacBook Pro, and there is
enough space around the sides. The
keypad is a segregated design and
exudes good feedback, and the keys,
although not bevelled, have sufficient
spacing to make up for this.
While Apple gets the display resolution right (1440x900 pixels), it has
gone cheap on the quality of the panel.
Colours look washed out, contrast is
minimal, and on maximum brightness,
52

CFO INDIA

JANUARY 2011

the blackness level looks mediocre.

The Air comes with a 1.86 GHz Core
2 Duo - not bad, considering its slimness. The graphics solution is a pretty
robust NVIDIA GeForce 320M running of a PCI bus, with 256 megabytes
of video RAM. This should suffice for
casual gamers, and is definitely a cut
above Intels integrated solutions. The
2 GB of DDR3 RAM might seem a bit
slim, but we keep reminding ourselves that the Air is only skin deep.
The real surprise is the inclusion of
a 256 GB SSD. This obviously saves
on space as well as improving overall
performance. The downside is, it adds
to the price, big time! There are two
configurations. A smaller 128 GB SSD
in lieu of the 256 GB one reduces the
price to Rs. 79,900. However, at this
price, you can pick up a MacBook Pro,
with better hardware.
SPECIFICATIONS: CPU: Core 2 Duo
L9400 (1.86 GHz); RAM: 2 GB DDR3;
Graphics: NVIDIA GeForce GT320M (256
MB); Storage: 256 GB SSD; display: 13inch, 1440 x 900 pixels; weight: 1.32 kgs.
PRICE: Rs 98,900

HTC 7
Mozart
The Mozart is a
Windows 7-based
handheld offering
from HTC. The
phone features
Microsoft Zune integration, so that
users can synch media on their HTC
with their PC. Other specs include an
8MP camera with auto focus and
flash, 576MB of RAM and 512MB of
ROM. Price: Rs 26,490

Samsung NX 11

The NX11 is a mirrorless camera.

Its lens includes a button that allows the user to control the shutter
speed, aperture and exposure. It
offers 14.6-megapixel captures and
a 3-inch OLED display Price: $649
POWERED BY

ad
Re Y
st OG
Mo L E
s NO ZIN
dia CH GA
In TE MA

CFO LOUNGE

TRAVEL

FLORENCE, ITALY

In Italys Art
Capital
Anoop Chugh travels to Florence

on a whistle-stop tour and

comes back pining for more.

TWO OF ITALYS contributions to the world have

always attracted me, even before I was introduced to
penne, spaghetti or gelato: The Italian pizza and the
Italian renaissance. A two-day stop-over at the countrys
cultural capital of Florence was a dream come true for
an art aficionado. Here was a place that had reinvented
money (in the form of gold florin), pioneered the use
of vernacular (marking the end of Latin), invented both
Renaissance and neoclassical architecture, sold pizzas
in weight and pioneered the art of Opera. It is also the
birthplace of, among others, Leonardo da Vinci, Niccolo
Machiavelli, Michelangelo and Gelileo Galilei. For those
fashionably inclined, two of its more recent celebrity sons
are Salvatore Ferragamo and Roberto Cavalli.
The dilemma that most tourists end up with here is how
to visit the many museums, art galleries and churches
stuffed with some of the finest art works in the world and
still find time to have a nice Italian meal and see the many
other sights of Florence. The faster (and a little expensive)
way of seeing the city is by renting a self-driven car. The
problem is, cars would not allow you access to the historic
city-centre of Florence. Only residents with permits are
allowed to drive there. To make matters worse, Florence has
some of the narrowest streets in Europe (even by Indian
standards), a series of labyrinthine that confuse even locals.
Driving however, is recommended to reach destinations
outside the city including Siena and Arezzo.
If you can ride a bike, though, rent one. Bikes can be
hired at several points in the city (and returned to the
same place). Almost all the historic centres of Florence
can be reached by this mode of transport. But be warned traffic is terrible, and buses, trucks, cars and motorcycles
are all fighting for the same space. If you are an art lover,
do not miss this chance to visit the Piazza del Duomo, the
historic Palatine Gallery or the Modern Art Gallery. The
54

CFO INDIA

JANUARY 2011

ABOVE: IF YOU ARE

AN ART LOVER, DO
NOT MISS THIS
CHANCE TO VISIT THE
PIAZZA DEL DUOMO
LEFT: THE PALAZZO VECCHIO IS THE
TOWN HALL OF FLORENCE. THIS MASSIVE,
ROMANESQUE, CRENELLATED FORTRESSPALACE IS AMONG
THE MOST IMPRESSIVE TOWN HALLS OF
TUSCANY.

Palazzo Vecchio or the town hall and the vast expense of

the Boboli Gardens are also must visits. If art is the last
thing on your mind and you still happen to be in the city,
you can indulge in some serious retail therapy here. And
if it is bargains that is on your mind, try the San Lorenzo
market for great deals. If nothing else, navigate the winding staircases inside the Duomo or the nearby bell tower
to capture some of the best views of the city.

WHERE TO STAY: Giardino di Leopolda if on a budget. The Grand

Hotel Cavour and Hotel Degli Orafi are luxury hotels.

HOW TO REACH: Jet Aiarways. Al Italia and many other airlines

operate flights out of major Indian cities to Rome or Milan and on

to Florence.

CFO LOUNGE

ARTS

ARTIST OF THE MONTH

This Too Shall

Pass
Sudharshan Shettys

exhibition of installations
and sculptures dwells on the
history of Mumbai.
By Anoop Chugh

Born in 1961 in
Mangalore, Sudarshan Shetty completed his Bachelor
of Fine Arts from
Sir J.J. School of
Art, Mumbai (1980
to 85). He received
Fellowship at the
Kanoria Centre for
Arts, Ahmedabad.
His art world
reflects contemporary urban life. He
has participated
in the Private
Mythology: Contemporary Art from
India (Tokyo) in
1998, Kwangju Biennale (Korea) in
2000, and Century
City (UK) in 2001.
His work was
on display at the
Indian Art Summit
at Pragati Maidan,
New Delhi from
Jan 21-23.

56

CFO INDIA

SUDARSHAN SHETTY HAS been a creator of artworks since 1990s, sculptures and
installations being his specilisation. Through
his installations he represents a world full of
light-heartedness and freedom, liberated from
political issues.
His latest show titled This too shall pass,
makes a poignant statement about everyday
life and silently reassures us that this too shall
pass. The show underlines the value of fleeting memories that often escape us, experiences
that one wishes to hold on to but cannot.
Shettys work can be best described as philosophical investigation of the vulnerabilities
and lost histories of a metropolis - in this case
the city of Mumbai.
His unconventional approach can be gauged
from his life sized gold-leafed fibreglass statue of himself. Shetty leans his sculpture at an
angle, connecting it to a donation box, whose
weight balances its own. A total of about Rs.
25,000 in coins will make the statue stand
upright again. This work raises multiple issues: does the donation box delegate sanctity
to the statue, making it one to be worshipped?
Are objects in the museum always divorced
from religiosity? Does a leaning statue even
deserve to be in a museum collection? Further
recounting the age-old tradition of weighing
monarchs in gold, Shetty allows the people to
decide the fate of his statue. By making the
donation voluntary, Shetty not only renders

JANUARY 2011

HIS LATEST WORK (ABOVE AND LEFT-BELOW) IS

A POIGNANT STATEMENT ABOUT EVERYDAY LIFE
THAT REASSURES US THAT THIS TOO SHALL PASS

(RIGHT) SHETTYS
WORK FROM ONE
OF HIS PREVIOUS
EXHIBITIONS - LEAVING HOME (2008)

the work participatory, but also allows the

viewer to make the choice of participation.
Another piece of his contemplative art work
is a delicately carved chair with a bright red
seat cushion that bleeds in drops from one of
its corners. Placed on the chair is a neon sign
reading scar, which conjures up images of
ghastly pasts, trauma and perhaps even shame.
So even though this too shall pass, the scars
remain, branding the body of the survivor with
a grim reminder of times gone by.
Another work, an ornately carved wooden
doorway with a sword swinging precariously
over it, threatens to behead the viewer. The
wooden remains of a ghost car and a steel carcass of a rocking horse also hint at the ravages
that the passage of time wreaks.

CFO LOUNGE

BOOKS

NEW RELEASE

Use your head

PICK OF THE MONTH

Final Call
Is a financial crisis like that of
2008 waiting to happen again?
Read this book to find out.
By Anoop Chugh
FAULT LINES IS A book
where economist and
author Raghuram G
Rajan forewarns us about
skeletons still hidden in
the cupboards of many
corporate houses. The
author fears that the
shortcomings that had
led to the crisis of 2008
might have not been
fully addressed; hence
the turmoil may reappear
as our tendency to take
risks and the unabashed
greed get better of prudence. There werent many takers
for his warning note (White Paper) when last time he had
foreseen a financial crisis in the making in early 2007. This
time ignore him at your own peril.
In Geology, fault lines are breaks in the earths surface
where tectonic plates come in contact or collide resulting
in great stress around these fault lines. The author has
used the same metaphor to talk about fault lines that have
emerged in the global economy.
He cites three reasons why these fault lines could prove
ominous: political decisions that are popular instead of being financially prudent, trade imbalances between countries
and different types of financial systems trying to merge.
At times the writing would seem pessimistic, even
distrustful of the current economic revival. Is the so-called
revival a sham? One will have to read the book to find out.

Book: Fault Lines

Author: Raghuram G Rajan
Publisher: Harper Collins
Price: Rs 499
58

CFO INDIA

JANUARY 2011

EVER WONDERED what goes on

up there. What makes us happy or
sad, angry or anxious? The Freeman brothers unravel the secrets
of the mind and explain the scientific facts behind our behavior.
Having trouble sleeping? Suffering
from panic attacks? Use Your
Head will pin-point your symptoms and give you practical advice
on how to overcome these difficulties. Clear, concise and
immediately relevant.

Publisher: Hachette
Price: Rs 299
OTHER RELEASES

Destination Work
AT THE BOOKS centre is the story of
Nancy Kim, a human resources director
at a magazine that is struggling with all
the problems associated with unhappy
employees - low productivity and morale along with high
absenteeism and turnover. After she challenges the CEOs
management-by-the-numbers system, shes asked to offer
an alterbative. Filled with real-world studies, Destination
Work! shows anyone how to turn the workplace into a
destination - a place where working is enjoyable and fun.

Publisher: Westland Price: Rs 150

Highway on my plate
DRIVING THROUGH INDIA and want
to know where to eat on the road? Try
Highway on my Plate: the Indian guide
to roadside eating, the countrys first
guide to dhabas and roadside restaurants. Adapted from
the hit TV series on NDTV Good Times, Highway on my
Plate, it lists the top eats on almost every major Indian
highway and routes as presented by the popular anchors
Rocky and Mayur.

Publisher: Random House Price: Rs 299

NOT JUST

THE LAST WORD

Zero tolerance the

need of the hour?
Reading through this issue of CFO India, I am struck by two things.
The varied understanding of what is ethical corporate behaviour; and
the chasm between what people expect and what they do/accept i.e the
gap between words and behaviour. Both these observations, muddy the
potential for a cleaner corporate ecosystem in the future. Let me explain
why I think so.
Ishat Hussain, one of our most reputed and
admired senior corporate leaders, says that out of
thousands of large corporations only a handful have
seen fraud in the last decade or so. His list includes
Enron, Andersen, Satyam, Parmalat and when he
comes to Lehman, he isnt quite sure that it qualifies
as fraud. His belief is that by and large, companies
want to do good and behave responsibly. On the
other end of the spectrum, is Nawshir Mirza who
says and I quote, the capitalist system has conveniently reduced the definition of ethics to not paying
bribes and not consciously violating the law. Marginal doubts and often not-so marginal ones of compliance are resolved by asking lawyers for opinions that
justify adoption of a practice which violates the spirit
(and in many cases the letter) of the law. Most of us
of course, conveniently and predictably, sit somewhere in between. Which means our levels of tolerance for what might be inappropriate or unethical
conduct but is not purposefully fraudulent are
pretty high. A dangerous place for a CFO to inhabit!
As a society and a corporate ecosystem, we rationalise our behaviour which is often substantively
short of ethical but continue to lament the erosion
of values, the lack of ethics, misgovernance, widespread corruption, etc. So what do we really want? Are
we okay with existing corporate norms - which may
be poor on governance at large, but arent fraudulent?
Or are we pushing for a cleaner and more trustworthy environment where corporations and their leaders set the tone for exemplary ethics? Are we genuinely done with living in a corrupt environment? Has
the impact of poor governance now reached People
Like Us and therefore we want change?
60

C F O

JANUARY 2011

If we are divided on this issue, then we

must make peace with the way things are.
And stop lamenting.
But if a large majority wants things to
change and create a cleaner ecosystem then we have to make a transformational
effort. The penalties of deviation from
expected behaviour must be immediate
and disproportionately high for a crime.
The message has to be loud and clear the
system and society have zero tolerance for certain
kinds of behaviour. Punishment that is inadequate and
delayed is as good as non-existent given the myopic
quarter-on-quarter approach to life in corporate India.
There is one more compelling reason for demonstrating zero tolerance. A friend who is familiar
with Pavlovian principles (around the reaction of
humans/animals to their external environment)
and conditioned reflexes told me that what it takes
20 sessions to learn needs more than a 1000 to
unlearn. Applying this information to the problem
at hand what we as a people have been doing for
the last few decades will not change overnight or
even in a decade left to itself. And since we cant
afford to wait a century to change we have to create an artificial environment for this transformation.
Extraordinary challenges like corruption in India
demand and deserve extraordinary re sponses. Do
you agree?
Anuradha Das Mathur, Publisher CFO India