Structures Of Greed

Corporate India is perhaps just a part of our essentially venal society

DILIP CHERIAN

Illustration Anand Naorem

THE WORLD of tumultuous capitalist growth is a monstrous and complex thicket. The survivors in that jungle are often truly adventurous scoundrels, who harness their highest levels of ambition to create commercial juggernauts. Adventure and amorality are, in a sense, inextricably linked in the very DNA of capitalism. Even John Maynard Keynes said, “Capitalism is the astounding belief that the most wickedest of men will do the most wickedest of things for the greatest good of everyone.” Look at aggressively-capitalist-but-nowbankrupt Greenland, at Madoff who made off shamelessly in capitalism capital Manhattan, and others. Remember just two of today’s biggest global skulduggeries — Enron in the US, which wiped out $3.7 billion, and Europe’s Parmalat, which helped skedaddle $18 billion. Don’t forget either WorldCom, Global Crossing, Tyco or Vivendi.

The big questions triggered by Satyam and now Wipro, is whether Indian corporates are more mired in poor corporate governance than others globally. The short answer: probably yes. The most obvious reason for this is the nature of our polity. Pathetic levels of probity in public life, absence of an ounce of corporate transparency and widespread bureaucratic malfeasance are components of much that is Indian society today. Yet, to point out that we are today largely venal verges on the unpatriotic, and is sacrilegious. But just last year, India was ranked a lowly 74 among 180 countries of the world on the worldwide Corruption Perceptions Index. Enough said.

Also, a Darwinian evolutionary issue is that Indian corporates have had to deal with an extremely repressive regime during the last few decades of socialism and quasi-capitalism. You had to fudge habitually merely to survive. You had to befuddle aggressively to forge ahead. The World Bank ranks India as a liberalised and globalised economy as 120th out of 178 countries in terms of the ease of doing business. A Harshad Mehta soared into the stratosphere only because he leapt through loopholes in the banking system to rip off $1 billion in 1992. From Mehta to Raju, not much has changed. Clearly, only the competently and continuously corrupt can actually grow at a blazing pace.

Also on the evolutionary tree, even the most blueblooded Indian corporates are still at their early stages of development. The robber barons of the American Wild West and the devilish chieftains of industrialising Olde Europe have had the benefit of whitewash and it’s only recently that proactive regulation and Sarbanes-Oxley arrived. This, after securing massive global marketshares, the spoils of colonialism, or the convenient fog cover of historic memory loss. Indian companies haven’t had that luxury yet.

Still, why are there seemingly synchronised exposures of corruption across the world? Is it the Kalyug thingy? Are we living in more corrupt times or is it now easier, within the Internet-connected borderless world, for those who perpetrate large-scale scams to escalate them? Is it easier for alert whistleblowers to expose and then indict those that are spotted? Or is India only part of a collective global slide down an unholy hell?

And is poor policing part of the problem or part of the answer? When the fence begins to eat up the farm either because it is too corrupt or like Alan Greenspan and sub-prime — because the regulator is also a believer in greed — then there is little chance that policing will solve the problem. That, too, is one of India’s current corporate anxieties. There is more yet to come, there is more yet that’s hidden; but then I run ahead of my tale.

Cherian is a columnist and business editor