Satyam Computers' Corporate Governance Fiasco (H): One Year After



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Code : GOV0045

Year :
2010

Industry : IT-ITES

Region : India

Teaching Note: Available

Structured Assignment : Available

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Abstract:
Satyam Computers Ltd. (Satyam) received the Golden Peacock Global Award for excellence in Corporate Governance in September 2008. Just 3 months later, on January 7th 2009, the founder and chairman of Satyam Computers Ltd. (Satyam), Ramalinga Raju confessed that he had cooked up the accounts– a sheer lapse and mockery of corporate governance on the part of Satyam. This case study highlights how the management was bailed out by the government-nominated board successfully. It focuses on the status of the company Mahindra Satyam (Msat) 1 year after the takeover by Tech Mahindra. It also highlights the challenges and issues being faced by Msat while debating whether companies of national importance should be bailed out by the respective government when it hits the dead end (financial bankruptcy or moral bankruptcy leading to financial bankruptcy). It also attempts to explore the ways and means to avoid the occurrence of such scandals in future.

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Pedagogical Objectives:

  • To provide a comprehensive recap of the sequence of events that led to Satyam Computers’ corporate governance fiasco and the eventual sell-off of Satyam to Tech Mahindra
  • To examine the status of Mahindra Satyam after 1 year and discuss the strategies adopted and the precision of execution by Msat to stabilise the rocking ship and to know the status of the criminal proceedings initiated against all the related parties in Satyam’s corporate governance fiasco
  • To discuss the broader lessons learnt from Satyam fiasco and analyse the implications thereof from the standpoint view of (a) India Inc. and (b) regulators like SEBI
  • To debate and explore on the ways and means for non-recurrence of such colossal corporate governance failures.

    Keywords :Satyam Saga, Golden Peacock Award, Maytas Properties, Maytas Infra, Tech Mahindra, Satyam Acquisition, Government-appointed board, Restructuring Satyam, Mahindra Satyam, Criminal Proceedings, Pricewaterhouse Coopers, Satyam Corporate Governance, Management Bailout, India Inc,, SFIO, SEBI, Independent Directors, Company Auditors

    Contents :
    » The Infamous Confession
    » The Transition
    » The Restructuring
    » Satyam Saga: Lessons for India Inc.


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