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TCS will take strong action against staff over ethics breach: Chandra

TCS bans six employees, six staffing firms in hiring scam

Tata Sons chairman N Chandrasekaran

Tata Sons chairman N Chandrasekaran

Shivani Shinde Mumbai

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India’s largest information technology services firm Tata Consultancy Services (TCS) said it would take strong action against employees who violate the ethical code of conduct of the company. N Chandrasekaran, chairman, TCS, responded to shareholders’ questions at the 28th annual general meeting.

On macroeconomic uncertainty, he said that discretionary spending in the short term would be volatile, but in the medium to long term, all changes — generative artificial intelligence (AI), Internet of Things (IoT), and Cloud — augur well for the company and the sector.

For the first time, answering shareholders on the bribe case in recruitment, Chandrasekaran said that six employees and six business associates (BAs or recruitment firms) had been banned. An investigation on three more employees is ongoing.

“For a Tata Group company, the most important thing expected from every employee is ethical conduct and integrity in operation. This comes first before any financial performance. Whenever there is a violation of the ethical conduct by any employee, it pains us, pains me, and all the leaders… We take it very seriously, and we always deal with such violations with strong action,” he added.

While explaining the case to shareholders, Chandrasekaran said that the company received two whistle-blower complaints in February and March, and both complaints were investigated. The complaints were about certain favouritism being done and favour being received in the recruitment of BAs. “This complaint was against certain people in the company working with certain BA firms recruiting in their favour. We found six employees who did not follow the ethical conduct. While we cannot quantify the favours they received, they behaved in a way that they were favouring certain firms. So we have banned those six employees and also six companies. Investigations are pending on three more employees,” he told shareholders. Chandrasekaran also added that the company works with nearly 1,000 BAs globally as they recruit resources in 55 countries.

“The company will look at the entire BA supplier management process and see what the weaknesses are and will tighten the process to ensure we do not face such incidents,” he added.

The company has two departments — human resource and talent acquisition which hires people; and a resource allocation group, which is about the deployment of available resources into projects. On the growing concern about uncertainty in the macroeconomy, rising inflation and sluggish growth, Chandrasekaran said that companies would calibrate their spending.

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“Companies will choose from certain discretionary spending. I believe that the growth for the medium to long term is going to be strong. But in the near term, there will be volatility across sectors,” he added.

He also added that when it comes to technologies like IoT, predictive AI, and generative AI, they augur well for the company and the sector.

Chandrasekaran shared that the world is navigating through three fundamental transitions — digital and AI transition, energy transition (green), and transition to a globally sustainable value chain.

“These transitions require significant investments in technology and innovation by all our clients, and offer tremendous growth opportunities for the company. TCS is also focusing on building talent for the future. New technologies require talent with the right skillset. Your company is making significant investments in recruitment and training,” he told shareholders.

On generative AI, Chandrasekaran said that the opportunity/impact it can create is at a whole new level.

“Countries the world over will come up with regulations to make sure generative AI is used responsibly,” he said.

Overall, he shared that the impact of AI, along with generative AI and other technologies, will only be beneficial to society and businesses, and TCS will invest in building capabilities.

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First Published: Jun 29 2023 | 9:38 PM IST

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