For the second time in a week, the management of Satyam Computer Services has taken to hiding behind alleged business confidentiality to avoid answering simple, factual questions, raising significant concerns about how the company goes about its business.
In both cases, the other parties involved, India’s so-called Big Four audit firms and, now, the World Bank, have spoken to the media, giving their version of the facts. The bank’s official confirmation that it had indeed banned Satyam in September for the next eight years is very troubling, as it also involves allegations of data theft and probes by the US justice department. This, even as Satyam stonewalls questions about how it could agree to pay $1.6 billion for two firms promoted by the family of chairman B. Ramalinga Raju.
Satyam and Raju’s lack of basic accountability and their falling credibility have pushed shares to a 52-week low. The longer they duck these questions, the more damage will be done to shareholders as well as to good corporate governance practices in India.