FISCALLY FIT
Life lessons from Satyam
SHYAM P.
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The pursuit of happiness, not success at any cost, is a worthwhile individual as well as corporate goal.
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The pursuit of “success” at the cost of moral virtue may offer immense financial wealth but rarely happiness or peace of mind.
Caution: Philosophy ahead! A life driven with blinkers, in search of the popular definition of “success”, namely, money, fame and power, begets cancerous greed that can potentially invade even the basic moral values, enslave us to peer pressure and leave us with a permanent sense of insecurity. The dogged pursuit of such a “success”, largely governed by external parameters, comes with an enormous cost — “happiness”. As an alternative, doing what we love and doing it with a clear conscience can help achieve a better version of “success”, which is internal to us, is more fulfilling and leads to a happier life.
Down slippery lane
Much has been written about the Satyam saga, since the day Mr. Raju published the sensational story about the tiger’s tail. Sadly, what I have not heard so far is an analysis of what it was that fundamentally drove Mr. Raju to perpetrate this. Does this event raise an alarming sign of something much deeper engulfing our society, given the increasing number of corporate scandals across the world? Are we to blame? What are the broader lessons for the next generation?
I have never met Mr. Raju, nor do I know anything about his personality, his ideology, or the circumstances that prompted him to go down the slippery slope. But it appears there were two fundamental attributes that governed his actions: 1) desire to maximize wealth and power for himself and his family with scant regard for the other stakeholders; 2) not minding being dishonest and unethical in order to achieve the above purpose. Although the full extent of financial activities that went on behind the scenes is yet to be unearthed, it appears that they constitute one or more of the following: funnelling out cash from the parent company, establishing a shady nexus with politicians, cooking up bogus numbers to keep performance in line with leading peers while gradually reducing personal shareholding, investing company’s wealth in personal real estate holdings, patronising the son’s firm at the cost of the parent.
Let’s take the first attribute, “hoarding of personal wealth gaining precedence over all else”. Aren’t most of our lives driven by this shallow goal? As employees (including non-owner CEOs), how many of us really care about the long-term performance of the company that we are working for? Aren’t most of us just interested in getting our salaries, bonus or stock options and making most money for ourselves in the process, as quickly as possible?
Road to disaster
It is these attitudes that led to the collapse of Wall Street and brought the global financial market to its knees. CEOs and staff in leading investment banks and hedge funds acted in a way that would maximise their year-end bonus, with little regard for how their actions would come back to haunt the firm in the future. And now the same guys are crying about losing their jobs! What an irony!
With promoters, there is a different problem. Very few seem to care about the faith and the trusteeship responsibility imposed on them by external shareholders, after the IPO is completed. So instead of focusing on whether the company is managed efficiently for the benefit of “all” shareholders, they are more interested in making use of the company to make more money for their own family. This gives way to all kinds of creative practices, which may or may not be illegal but is definitely unethical. Looking at the extent and variety of questionable practices adopted by promoters of publicly listed companies, I really feel this is not a regulatory problem but an attitude problem.
The one-dimensional approach of employees and promoters who believe “personal wealth maximisation alone matters” only leads to selfish greed. But, greed is bad! Not only for society but also personally. Irrespective of what Michael Douglas may profess in the movie “Wall Street”, the problem with leading a life purely for the sake of personal wealth and power is that even when you have it, you either want more of it or you are afraid of losing it and hence never “happy”.
What is necessary for a strong economy and a fulfilled life is that every employee and promoter should be driven by passion and not greed. A passion to expand knowledge, to improve people’s quality of life or to just be part of building and growing an institution that will outlive you. A passion to love your job and not only your title, net worth, salary or perks. And above all, a passion for promoters to genuinely share the wealth — with shareholders, employees and the community, instead of just focusing on expanding the family’s net worth.
Sustainable happiness
Now, let’s take a look at the second attribute of the Satyam imbroglio: “not minding being unethical in order to achieve greater personal wealth and power”. I for one cannot think of a better end goal in life than “happiness”, so I believe that even when people go crazy in the pursuit of extraordinary money and power by acting against their conscience, they do so only to attain “happiness”. If this is a fact, they can’t be more grossly wrong in their means.
Scientific research has proven that the average human has an innate morality, a fundamental sense of right and wrong that is much deeper than all our cultural, judicial or religious adaptations. Apparently, this internal “moral compass” in our brain will not let us stay happy without having a clear conscience! Although this compass can be overcome in the short term by the desire for money, fame, power or other pleasures; by feelings of anger, revenge, fear or external pressure; or by self-rationalisation, the compass normally resurfaces to annoy us over the longer term (unless we suffer from mental deficiency). Experimental findings indicate that people can clearly recollect the incidents where they acted amorally, many years later, as these are deeply imprinted in the mind.
An extension of this human trait is our desire to cleanse ourselves of past amoral actions. We try to achieve this through many avenues — religion, donation, service-to-society or some even through suicide. And all this only to “feel good” about ourselves, i.e., attain “happiness”, if not in this life at least in the next. (Wonder what were the transactions between Mr. Raju and Tirupati.)
The existence of a “moral compass” has been validated by incidents of voluntary public confession by people, especially as they grow older, about acts committed much earlier in their lives. When enquired about their reason for coming clean despite the potential blow to their reputation, they said they just wanted to sleep peacefully at night. I guess Narayana Murthy’s famous saying about a clear conscience being the softest pillow in the world is true after all.
As citizens of Corporate India, let’s try do the right thing, if not for others at least for our own happiness.
This is your fortnightly column on money matters. You can reach the author at: shyamscolumn@gmail.com or www.shyamscolumn.com
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