Dr. Vijay Mallya, judge yourself by your own words

Image Courtesy: Tehelka

“The accountability for performance in business is no different to accountability of governance. This great nation has to think of tomorrow and beyond, and the standards of performance and accountability by both, Government and business, must set an example for the future.”

Does this advice rankles Dr. Mallya’s mind (if not as a missed heart beat) when he takes a break from his favourite drinks at his royal retreat outside London? Perhaps not because he might not recollect that he stated this on 3^rd May 2002. The occasion was an “awe-inspiring moment in my life” as he put it while delivering his maiden speech as a MP. And the debate he chose to participate was Gujarat riots.

He stated: “Let the failure of performance of the Government in Gujarat be an eye-opener. Let us not indulge in recriminations; but set an example on how the failure in governance should be dealt with, so that these unfortunate happenings are eradicated and never repeated.”

Dr. Mallya should apply his thoughts and values to Kingfisher Airlines (KFA) whose failure to pay to employees, vendors, statutory authorities and lenders constitute the moment of reckoning. Parliament would like to hear from him how failure in corporate governance and ethics should be dealt with. 

People now also want Dr, Mallya to live by your words. The public expect him to come back to India and to either settle or fight his KFA legal battles with all stakeholders including ex-employees, some of whom have been reduced to paupers for want of accountability that you once professed.

His Rs 4000-crore one-time settlement (OTS) offer made through his lawyers in Supreme Court does not comply with minimum performance standards set by himself, government and RBI. This issue, however, can be elaborated in a separate write-up.

Reverting to Mallya as an businessman, his well-wishers would want him to see in board rooms of UB group companies including stock market-listed United Breweries (Holdings) Limited (UBHL), whose assets he estimated at more than Rs 12,000 crore in a letter dated 28 September 2011.  It appears to be a sinking ship.

As put by UBHL’s annual report for 2014-15, “Accumulated losses of the company are more than fifty percent of its net worth. The company has not incurred cash losses during the financial year covered by our audit. The company has incurred cash losses during the immediately preceding financial year.”
It adds accumulated losses of the group are also more than fifty percent of its net worth.

UBHL subsidiaries -Kingfisher Training and Aviation Services Limited, UB Infrastructure Projects Limited, Kingfisher Aviation Training Limited, Bangalore Beverages Limited, UB Sports Limited, Kingfisher Goodtimes Private Limited and Bestride Consultancy Private Limited have been facing liquidity crunch, resulting in their ability to transfer funds to parent company being significantly impaired.

When the King of Good Times heralds bad times for its employees, lenders and vendors, corporate accountability naturally becomes the national agenda. Questions of all sorts have thus been put in the media. Mr. Mallya can rightly contend that he is being singled out from loan defaulters by media. He should, however, know that this is the price one pays for projecting an image of King of so-called good values (lavish parties, flirting with girls, seductive calenders and making exorbitantly expensive offering to deities while compromising KFA staff’s right to life which depends on right to earn livelihood).

Mr. Mallya can ignore questions, pinpricks and slurs from media. How long he would, however, avoid face-to-face questioning from Enforcement Directorate and other statutory authorities? What if banks spurn his OTS offer? What if criminal investigation cases by authorities result in framing of concrete charges and are presented to the judiciary? What would he do if Supreme Court ultimately directs him to appear in person to defend himself?

And how long he would fritter any opportunity to put interesting questions on wide range of subjects in Rajya Sabha? The subjects on which he raised questions include loan write-offs, money laundering, extradition treaties, tax information network, provision of alimony on break-up of live-in relationship, rehabilitation of children of devadasis and development of missiles.

He wore his heart on the sleeve while raising issues concerning industries in which UB group has had presence. These include fertilizers, liquor, Formula-1 car racing and aviation.

Participating in the debate relating to Union Budget for 2004-05 on 20^th July 2004, Dr. Mallya, for instance, appealed to Finance Minister “to pay particular attention to the difficulties being experienced by the domestic fertilizer industry as a result of which no fresh investments have been made.” He added: “A happy farmer needs a healthy fertilizer industry.”

This quote can be turned around by KFA stakeholders in different ways to underscore their plight. The message here is that Dr. Mallya can be confronted with his own preaching by digging into his speeches at different occasions including annual general meetings of shareholders of UB group companies.

Above all, he has to remember what he told Tarun Tejpal, Tehelka founder, at Tehelka’s Goa retreat – Think 2013. Dr. Mallya stated: “The way I look at life, you cannot complete a lifecycle without failures”.

Dr. Mallya should now put full stop to his corporate failures and use them as stepping stones for bounce back to good times for him and his countrymen.

Dr. Mallya must ponder over the concluding paragraph of his maiden speech in Rajya Sabha. He had stated: “I hope that all those who are privileged to be Members of this august House would devote their time, skills and energies to the emergence of a disciplined, result-oriented India, where citizens belonging to different castes, creed and religion, from all walks of life, can live with positive hope and actually look forward to the overall prosperity of future generations in the making of a great nation that will occupy its rightful place in the developed world.”

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