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In the case study discussed here, Rama Dutt
faced an ethical predicament at a private family
owned Investment Bank subsidiary whose customers were largely family owned small
and medium-size companies. The CEO and Chairman, of the I-Bank, Sunil Kher, concealed information
in the form of a better and higher offer to a prospective customer and thwarted Dutt
efforts, which caused the deal negotiations to break down.
It was September 30, 2008, when Rama Dutt, aged 38 years, had just moved to Mumbai
from Gurgaon, a fast growing city adjacent to New Delhi. Earlier, in the year 1998 Dutt had joined
as VP (Corporate Strategy) one of the largest soft drinks company in India, the `Cola' company
(CC) with over 50 bottling facilities all over the
country. There in the past decade, Dutt's company
had successfully acquired 10 bottling companies besides 12 small soft drinks companies around
the country. Under Dutt, the company had also divested in fast food sector successfully
through acquisitions. The total revenue of the
company had grown by around 20 times in the last 10
years to around Rs. 1,000 cr (one cr = 10 mn).
However, the weather conditions at Gurgaon never
suited Dutt and he was always suffering from some
kind of sickness. Around three months back, Dutt decided to leave Gurgaon.
Starting from October 1, 2008, Dutt was joining as the Branch Head of Mumbai Branch and
Head (Strategic Business) of the global investment subsidiary of a private bank in India at
its Corporate Head office. The subsidiary was
called `GIBA I-Bank' (GB) with eight branches in
the country and two branches in the US, with its Corporate Head office in Mumbai, which was
also functioning as the Mumbai Branch. However,
his earlier employer, CC was generous and sympathetic to his health needs and in the
process gave him an option to return and join the
same position by December 31, 2008.
The GB was the lead I-Bank for the CC, which had completed 90% of the acquisition deals,
and divestitures of the CC during the last 10 years
and in due course, had developed specialization in this sector and size of the deals
besides developing a very special business
relationship with Dutt. It was pure coincidence that GB's
Head Strategic and Branch Head, Mumbai, was
retiring after a service of 15 years in the organization
and seven years in the said position and GB were looking for a replacement. GB on knowing
that Dutt was looking for a suitable job in
Mumbai, offered him the position at its Corporate
Head Office. This was the first time in the last
two decades that someone from outside the organization had been offered such a
high position. |
