1011 Government should not PRIVATIZE AIR-INDIA, but it ought to DISSOLVE IT TO THE EXTENT NECESSARY

News reports indicate that Mr. Narendra Modi, the Hon. Prime Minister of India, is just a few days away from giving the final go-ahead for the government to sell off Air India, the debt-laden national airline, according to officials in Delhi. Here is a link to FinancialTimes.Com news report titled: "Sale of debt-laden Air India set for final approval Nearly 70 years of state ownership to end at group that led Asia into jet engine age'. Click here to go to https://www.ft.com/content/0f208898-573d-11e7-9fed-c19e2700005f?mhq5j=e1. To my ignoramus mind of half-baked knowledge, it appears to be a hasty and panic-filled decision. Pushing a boulder from the top of a cliff will be easy, but even that easy task can cause casualities of lives and property, if proper care is not taken. On the other hand pushing up a boulder to the top of a cliff will be extremely hard, and the results of all the Herculian efforts will depend on predicting future, which can sometimes resemble an 'astrological' exercise. Both ponderables and imponderables will have to be carefully searched for, identified, and taken care of, if the Herculian efforts have to give positive results.

Why Privatisation is not a real solution?

To come back and continue adding / deleting / modifying.

905 Not only the Corporate Governance issues pointed out by Mr. N.R. Narayana Murthy are to be addressed, but also at macro level Government has to conduct indepth studies of at least half of Corporates in India

There are some similarities and some variances between what is happening in the Board Rooms of Infosys and the Tata Group. We need not lay undue emphasis on differences among Board Members about matters relating to the Managements of their respective Companies. Reason: Differences are natural, and are bound to be there. Like the Meetings of India's Union Cabinet, or the Cabinets of States like Andhra Pradesh, Telangana State, Tamil Nadu, if every thing is conducted without arguments, dissent, some emotional outbursts, with bent heads, knelt knees, UNANIMOUSLY, then there must be something wrong. Whether it is in political democracies, or in Corporate Democracies, such blind-fold meetings can lead to incalculable damage and harm. Such blind-fold, dumb-fold meetings, when conducted in Corporate Bodies, can lead even to financial collapse of Companies. Such blind-fold, dumb-fold meetings, when conducted in Executive Bodies such as Cabinets, Legislatures, Advisory Councils of countries can lead to dictatorships and tyrannies, and finally lead to disintegration of countries.

Here is a link to HIndusthan Times, dated 14th Feb. 2017, which contains some observations made by Shri R. Seshasayee, the Chairman of Infosys, about 'differences' among Board Members, which he terms as "not conflict", but as "convergence". Click to go to Hindusthan Times, http://www.hindustantimes.com/business-news/infosys-management-vs-narayana-murthy-is-the-conflict-really-over/story-2czSEEwLX45xLapMixs4gO.html. Some of the observations:--

“...Something like this doesn’t happen again.”

"...I shall not quit unless asked by the board and the shareholders to do so. ..."

"...the Bansal episode has taught the board to insert severance details in contracts and not be subjective about them. Bansal, was eventually paid Rs. 5 crore as severance pay, not the previously agreed-upon Rs. 17 crore. It was not “hush” money to get Bansal to keep the peace. ..."

"...Sikka's salary has been approved by shareholders. ...".

"... The Board continues to address issues all stakeholders, including ones that the founders have, within the overall framework of the fiduciary responsibility it has to all shareholders. ...".

"...Board will treat the promoters just as it does 'any other shareholders' ...".

Here is a report which contains the observations of the Shri N.R. Narayana Murthy, one of the top five Founders of Infosys: Click to go to EconomicTimes.IndiaTimes,com to study what Mr. Narayana Murthy is reported to have said.

"...There is no let-up in my demand that the board of India’s second-largest software company satisfactorily address the issues of poor corporate governance pinpointed by me last week, striking a firm stance in what looks set to be a fractious corporate battle. ..."
“No, I have not withdrawn my concern,”

"...They (issues and concerns) have to be addressed properly by the board, and full transparency should be given and people responsible should become accountable...".

"...They are all good-intentioned people of high integrity, but obviously being human even good people sometimes make mistakes, this is one such case, ..."

"...But good leadership demands that they listen to all concerned shareholders, re-evaluate their decision and take corrective action. I hope they take corrective action soon and improve governance for a better future for the company..."

"...Such payments raise doubts whether the company is using such payments as hush money to hide something...".

Shri Balakrishnan: "... If investigations have proved there was nothing wrong, then why stop? Someone has to own this up. The chairman should take responsibility. ..."

"...Infosys board be recast with “some good people” like Marti Subrahmanyam. It should also induct unnamed former Infoscions, schooled in the Infosys values ...”.

ybrao-a-donkey's perceptions, which are not intended to be imposed on others

Out of the top four Info Giants in India of those days (TCS, Infosys, Wipro, Satyam Computers), the last i.e. Satyam Computers made an ignominous exit, as fudging of accounts by the then Satyam Management led by Shri Ramalinga Raju blew up, sending him to Jail. The remaining three IT Giants maintain a public profile which claim "honesty and truthfulness". While nobody knows what happens in those remaining Top Three Companies, and people go by revealed Financial Statements and Data, as certified by their Company Auditors.

One thing is definite. Since the 2008 Sub-Prime Lending Crisis which engulfed U.S.A. and the Wall Street, the Business Environment for Indian IT Companies has also undergone some unfavourable changes. In tune with those unfavourable changes, the three IT Companies ought to have made substantial provisions for unforeseen losses, but it is not clear to what extent they have made provisions.

The five top promoters of the Infosys (Sarvashri N.R. Narayana Murthy, Nandan Nilekani, SD Shibulal, Kris Gopalakrishnan and K Dinesh, seem to have withdrawn a major part of their investments from Infosys. They are said to hold, all of them together, about 12.75% stake in the Company. It can also be observed that , when the going is good, when the Business Environment is favorable, everybody will come forward to work as Chairman, CEO, CFO, so that they can take credit for the good results. But, when there is a dwindling trend of fortunes, nobody will come forward; Those who are at the helm, may try to step down, and chose either to retire, or go in search of greener pastures.

Promoters , having tasted power all-the-days when they were at the steering, after leaving the Company, because of past attachments (Sanskrit and Telugu: "vAsanAs"), may want to drive their Companies from back seat. This type of approach, reflects a type of urge "to eat the cake and have it too", exercise some authority, without match responsibility.

REPORTED SHARE-HOLDING MIX

(Approx.) Shareholding Mix of Infosys
Top Promoters: 12.75%
Foreign Institutional Investors: 39%
Insurance Companies: 11%
Mutual Funds: 7%
Foreign Non-Institutions: 17%
Public: 10%

ybdonkey always believed

In India, Private Sector Companies are NOT REALLY PRIVATE SECTOR COMPANIES. In most Companies, Promoters hold very little share-holdings, often less than 20%. But, Promoters, and their benAmIes pull the strings in the Boards, hold most Executive positions, and draw huge amounts as perquisites/remuneration/salaries. Besides, they also ensure that their kith and kin, and the Companies promoted by them, get all the supply Contracts, Distributorships, sine cure jobs in the Company.

Independent Directors, Directors representing Financial Institutions such as Mutual Funds, Insurance Companies, Foreign Institutional Investors, do not take active interest in the Management of the Company. Even when they attend BOard Meetings, they just sign the Attendance, raise one or two unimportant questions and queries for formality and ritual sake, have the dinners/lunches/refreshments, collect the gifts, receive Sitting Fees, collect Flight Tickets, and leave. In Telugu language, there is a proverb: "SingaDu addanki pOnU pOyADu, rAnU vachchADu." Approx. English: A person named "SingaDu" went to a place called "Addanki" in Prakasham Dt., of Andhra Pradesh, and came back, with no outcome. Attending Board Meetings remains just a symbolic appearance.

"... The Board continues to address issues all stakeholders, including ones that the founders have, within the overall framework of the fiduciary responsibility it has to all shareholders. ...".

"...Board will treat the promoters just as it does 'any other shareholders' ...".

These words of the Chairman, seems to suggest that promoters will be shown their place, in proportion to their 12.75% shareholdings. If the (former) Promoters try to exercise their will on the Current Management, the Chairman may try to take shelter in the Foreign Institutional Investors who have 39% shareholding, apart from trying to get support from Mutual Funds and Insurance Companies.

Though SEBI seems to have started making some inquiries into the goings on, such enquiries seem to be too little, when a lot needs to be done.

To continue adding / deleting / editing. सशेष. ఇంకా ఉంది.

848 Govt. of India should request retiring CJI Shri T.S. Thakur to lead an Investigation Team to look into the affairs of TATA Companies and Trusts

Hon. Chief Justice of India, Shri T.S. Thakur is going to retire on 4th Jan. 2017, after completing his 65 years of age. From the manner in which he conducts/conducted the proceedings of Supreme Court of India, this blogger ybrao-a-donkey gets an impression that, for his age, he is quite energetic, and there is substantial fuel and vigor left in him both physically and emotionally. It will, therefore, be in the fitness of things, that his services are used by Nation for National Benefit. We know that Mr. Narendra Modi Government is not in a mode to appoint a Lok Pal, unless it can find some one who is really ductile, malleable, and pliable. It does not mean that we should allow Shri Thakur to leave as a person whose services could not be effectually utilised by the Nation.

TATA GROUP AFFAIRS - WASHING DIRTY LINEN

Our Readers are aware that TATA Group of Companies are going through a period of stress of Corporate Governance, with the mutual accusations of Mr. Cyrus Mistry, the ousted CEO of Tata Group, and Mr. Ratan Tata, the former CEO + patriarch + de facto CEO of Tata Group. On 26th Oct. 2016, Mr. Cyrus Mistry alleged directors at India’s largest Corporate Giant of wrongfully dismissing him and warned that the Tata Group may face $18 billion in write-downs because of five unprofitable businesses he inherited. The entire Nation is enamoured and in the grip of standing in ATM queues, in an attempt to find cash for day-to-day sustenance of lives, and livelihoods. Consequently, much of what has gone in TATA Group Companies might have escaped attention of Indian Citizens. There is also a lurking danger of (I wish that it should not happen) Tata Group of Companies also going in the KingFisher and Vijay Mallya trajectory.

FACTS AND GRAY AREAS NEED DEEP INVESTIGATION

We know from history, and current affairs, that whenever there are mutual allegations, there will be some truths in the arguments of both the parties, and that there will be some gray areas which none of the two combatants may not like to touch, because in addition to the vulnerabilities of the other party, their own vulnerabilities will also come out. It will, therefore, be in the fitness of things that the goings on in the Tata Group Companies, Tata Sons, Tata Trusts are all studied in depth, by impartial persons, who are well versed in country's Business Law, as well as who have "sraddha" (sincerity and dedication) towards natural justice.

TOP TEN ITEMS WHICH CAN BE GIVEN AS TERMS OF REFERENCE TO THE SPECIAL INVESTIGATION TEAM (SIT)

1. Whether any Profits & Loss accounts, Balance Sheets have been fudged.

2. Whether all the assets physically exist, and their valuation conforms to the Standards of Accounting Practices.

3. Whether there are any understatements of liabilities.

4. Indepth audit of physical existence of stocks (inventory).

5. Whether there are any breaches of Trust, in TATA TRUSTS?

6. Whether there are non-permissible Inter-Corporate Investments?

7. Whether payments made to the CEOs, Directors, Trust Members are all in conformity with the Company Law, Trust Laws, good global principles of Corporate Governance.

8. Whether there are any violations of erstwhile FERA, present FEMA, and Money Laundering Act?

9. Whether there are any present/future risks of Indian Assets of the Tata Group Companies being attached by foreign courts, to satisfy the overseas liabilities of Overseas Companies registered by Tatas abroad?

10. Whether all the loans/advances/guarantees extended by Indian Public Sector Banks are safe, and possibilities of Public Sector Banks losing their funds a) within India b) outside India.

Incomplete. To continue. सशेष. लिखने के लिये और बहुत है। جاری رکھنے اور مزید لکھنے کے لئے ఇంకా వ్రాయాల్సింది బోలెడు ఉంది.