Satyam Computer Services Ltd may have pulled the plug on a plan to effectively enrich its promoter Raju family by acquiring two other related companies in the infrastructure business. But Satyam’s chairman B. Ramalinga Raju needs to step down and here is why:
1. He took us back to the India of the 1980s, even if it was only for a few hours.
2. He seemed to be looking out for himself, not investors.
3. By going back on the initial decision, he may have shown that he and his company listen to—or are frightened of—shareholder activism, but it also shows that Raju doesn’t have the conviction to stand by a supposedly smart diversification move for Satyam.
4. As chairman of Satyam’s ‘asleep-at-the-switch’ board, Raju should take the blame for one of the most asinine deals any company’s board has approved this century.
5. Raju’s game plan had the potential to put foreign investors off India. His resignation can show them that there is yet hope for good corporate behaviour here.