Page 101 - DCAP307_PLANNING_AND_MANAGING_IT_INFRASTRUCTURE

Unit 5: Corporate Governance and IT

ownership and accountability in corporate governance. They also talk about corporate Notes
governance and corporate control.
According to Allen the whole basis of the granting by the state of privileges of incorporation
needs to be re examined there is a need for a redefining of the nature of company, of its
ownership and of its control. In broader terms, the responsibilities and obligations which
a company owes to its shareholders, workers, creditors, consumers, and public at large
need to be examined at length.

Bryan and Farrell’s research work discusses about nature of corporate governance in the
developing global economy and pitfalls of this new economic structure. Their paper also
discusses about the role of Corporate Governance in the global economy.
Laixiang Sun, Damian Tobin in their research study focuses on firm specific actions that
aim to distinguish the firm from its peers. This paper focuses on Corporate Governance
reforms and International Listing with special reference to case of Bank of China. It reports
the disparity in credit ratings between Chinese Companies listed domestically and those
listed on international stock exchanges.
John L. Collyey, Jr. Jacqueline L. Doyle, George W. Logan, Wallace Stettinius in their book
titled ‘What is Corporate Governance’ deals about various aspects of Corporate Governance.
This book provides a deep insight to the topic. It also talks about duties and responsibilities
of top management towards the stake holders and society in general.
Robert A.G. Monks and Nell Minow’s book on Corporate Governance is based on the
trends and practices of corporate sector. This book talks about the practical applicability of
Corporate Governance. It also explains the importance of Corporate Governance with the
help of various real corporate examples.

Corporate failures have reasons first and for most are the bad business plans and poor
managerial decisions in some instance the government’s pressure and regulatory
forbearance is a contributing factor. Second reason of the corporate collapse is fraud or
dissimulation by management, ENRON, World Com, Maxwell, BCCI and Polly Pack are
some of the examples. In India we have the 3 Satyam Computers: Company Profile Satyam
Computer Services (Satyam) is a global information technology (IT) solutions company
including application development, maintenance services, consulting and enterprise
business solutions, extended engineering solutions and infrastructure management
services. The company also offers business process outsourcing services through Nipuna,
a majority owned subsidiary of the company. The company primarily operates in the US.
The company is headquartered in Secunderabad, India and employs about 51,000 people.
The company recorded revenues of $2,138.1 million during the fiscal year ended March
2008, an increase of 46.3% over 2007. The operating profit of the company was $413.8
million during fiscal year 2008, an increase of 40.5% over 2007. The net profit was $421.8
million in fiscal year 2008, an increase of 41.2% over 2007. Satyam offers a wide range of IT
solutions to meet today’s complex business challenges.
Satyam has partnered with many of the best of breed technology providers in all the
solution areas. While the alliance partner provides the software application, Satyam offers
professional services including business process consulting, systems integration, custom
application development, content development and other consulting and implementation
expertise.

Satyam Computers: Failure of Corporate Governance
This fraud that will impact the investors and employees of the company shows a systemic
breakdown in audit and board oversight of the company. Questions will need to be asked

Contd....

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