08 January 2009

Satyam Means Truth, but Truth Be Told, It Ain't True

Satyam Computer Services Ltd.Image via WikipediaSatyam means 'truth,' in Sanskrit. But truth is the scandal involving the Indian IT giant is the latest in a string of ethical lapses in business.

The scandal at Satyam Computer Services, a leading Indian outsourcing company that serves more than a third of the Fortune 500 companies, points to a moral bankruptcy among our business leaders.

And it raises the question of how many other companies -- public, private, and even non-profit -- are cooking the books or manipulating their balance sheets to give the appearance that their performance is better than it is.

Ironically, Satyam had been awarded last year's Golden Peacock Global Award for Excellence in Corporate Governance 2008. Excellence at fraud, manipulation, and malfeasance is more like it. What due diligence was done by the body making such an award?

Satyam's chairman and founder, Ramalinga Raju, resigned after confessing to falsifying accounts and that 50.4 billion rupees (US$1.04 billion) of the 53.6 billion rupees in cash and bank loans the company listed as assets for its second quarter, were nonexistent. That is no rounding error, it's a blatant lie.

How do people like Raju and Bernie Madoff and others think this kind of behavior is acceptable? We have evolved into a culture of success at any cost. And our children are following our lead.

Last year, a survey in by Rutgers' Management Education Center of 4,500 US high school students found that 75 percent of them engage in serious cheating. Even more disturbing is the fact that 50 percent of respondents to the survey said they don't think copying questions and answers from a test is really cheating.

We need to send a message to our leaders and to our children that getting ahead by cutting corners, cheating, and lying is not rewarded. We need to get back to basics and encourage an ethic of truth and transparency.

Winning at all costs is not acceptable behavior.

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