Last week, the front page of every national paper screamed with headlines about the cost incurred on Mayawati’s house when she was the chief minister of Uttar Pradesh. The middle class conscience was shocked. The chattering classes, mostly employed with the corporate sector, were aghast. Disdain about a “dalit” (purportedly oppressed) leading such a luxurious life at the expense of public money was widespread.
Mayawati’s propensity to spend was in the news last year too. Wikileaks had published a cable leak from a foreign diplomat gossiping about how she had flown an empty airplane to Mumbai only to fetch her prized footwear to Lucknow. She denied the report, and said the founder of Wikileaks be sent to mental asylum.
However, dispassionately, if equally hearsay evidence is to be gone by, Mayawati would be in august company – not just in the political world, but also in the corporate world. Her practices are only reflective of a propriety deficit in governance standards across society. Those elected to office for governance of the State get a disproportionate share of attention as compared to those elected to govern listed businesses.
Public governance does not extend itself just to matters of State. Governance of a company listed on a stock exchange, which raises money from the public, is equally a part of public governance. If it is not alright to lead a lavish lifestyle at the expense of the taxpayer, it is equally not alright to lead a lavish lifestyle at the expense of the public shareholder and depositor. The issue here is not the lifestyle. It is who is footing the bill to sustain the lifestyle.
Going by the same quality of gossip in the grapevine, the listed corporate sector is replete with instances identical to Mayawati, or perhaps, examples that would make her look good. One hears of corporate airplanes being flown to pick up a special kind of fruit that grows near the factory that the Chairman of a listed company has a fancy for. Stories of corporate jets being flown to another country to pick up a special type of dry fruit available in the local markets, for which the wife of the promoter has a liking, abound.
One hears of expensive IIM-educated recruits whose salaries are paid for by the listed corporate, spending expensive time following up with the Chairman’s tailors for delivering suits on time, or time paid for by public shareholders, with travel agents, consular staff and passport officers chasing the issue of the Chairman’s visas and passports.
Senior corporate bureaucrats (counterparts to the IAS officers) are said to lament in hushed tones (quite similar to the feeble laments from genteel IAS officers who do not want to be seen as eccentric anti-establishment officers who rock the boat) that since one has to take money out for the Lala, the entire system then has an incentive to partake in the leakage.
It is easy, or perhaps, convenient, to miss the nuance. Many believe, in the opinion of this column, wrongly, that listed businesses being in the “private sector” may be legitimately pilfered. In other words, symptoms like the ones listed above, would not even be acknowledged by them as pilferage. However, that public money may be used by one shareholder who is considered more equal than the others, to fund his personal expense and lifestyle will always remain a governance issue – regardless of whether one is speaking of corporate governance or State governance.
This is precisely the stuff that class actions suits are made of (counterparts of public interest litigation). And, this is precisely where India is sorely lacking. We rank 182 out of 183 countries covered by a study jointly published by the World Bank and the International Finance Corporation, in enforcement of rights. If a suit for damages would take 20 years for first trial, little wonder no one is able to do anything about listed companies spending funds on use of company jets by movie stars and politicians to make personal trips.
Or for that matter, lavish parties that would expend in one evening, Mayawati’s entire home décor budget, to celebrate the septuagenarian or octogenarian Lala’s birthdays.
The coverage of such parties and participation by senior media professionals in such parties is quite unabashed, as compared with being regarded as being “close” to a Mayawati. In lip service to the issue, the media is happy to attack professional CEOs earning a small remuneration of a few crores of pay to allege bad corporate governance, and to make icons out of businessmen who proudly wear their modesty on their sleeves, with imagery of economy class travel and bucket-baths.
This is not at all about defending Mayawati’s improprieties. It is only a reminder that he who hath not sinned alone may cast the stones.
(The author is a partner of JSA, Advocates & Solicitors. The views expressed herein are his own.)
All that is necessary for the triumph of evil is for good men to do nothing,” said British philosopher and statesman Edmund Burke. In India, the ...
Low buying interest from China, falling prices, 5% export duty on pellets impact exports