Opinion

Being Cyrus Mistry: Ashwin Sanghi on his school friend

'The one defining characteristic of Cyrus was that he always managed to be universally loved. There was an innate decency about him.'

I remember a 2006 movie directed by Homi Adajania called Being Cyrus. In that film, Saif Ali Khan played Cyrus Mistry who entered the world of a dysfunctional Parsi family and eventually ended up killing a couple of its members. The real life drama of Cyrus Pallonji Mistry is the story of yet another Cyrus entering a dysfunctional family (let’s call it Tata Sons if you like). But unlike the character played by Khan, this one was far too decent to kill others. Unfortunately, the problem with the world that we live in is that either you kill or you get killed. Figuratively, at least.

The question then is this: will this Cyrus live another day to conquer, like Cyrus the Great of Persia? As a writer of complex mysteries with sudden plot twists, I believe this story has not yet reached its climax and we may yet be surprised by further developments along the way.

Cyrus and I were classmates during our years at Cathedral and John Connon School in Mumbai. He wasn’t academically brilliant, nor do I recall him as being outstanding in extracurricular activities. The one defining characteristic of Cyrus was that he always managed to be universally loved. There was an innate decency about him. I guess it was this decency, coupled with an uncanny ability to get along with people, that stood Cyrus in good stead in later years.

Dale Carnegie, the guru of winning friends and influencing people, said, “When dealing with people, remember you are not dealing with creatures of logic, but creatures of emotion.” And that sums up Cyrus – working with people, understanding the emotions that drive them, and often getting them to do extraordinary things.

I met Cyrus rather infrequently after we had put our school years behind us but his warmth and graciousness remained ever present on the few occasions that we did meet. I recall a flight from Delhi to Mumbai several years ago (much before he became chairman of Tata Sons). He switched seats with the passenger seated next to me and we spent the next couple of hours reminiscing about the good old days and exchanging business notes. As I recall, during that conversation, Cyrus remarked that reputation is more important than revenue and that people are more important than profit. He went on to say that if one operates with a concern for reputation and people, then revenue and profit may follow, but not vice-versa.

It was the first time I realized that there was much more substance to my school friend than I had imagined. It is also the reason why I believe that he went into the Tata conglomerate with honourable intentions. It is possible that those intentions may not have been in sync with some other stakeholders but the reason that one appoints a chairman is to place a leader at the helm, not a lackey.

Fading halo

It was around 2012 that I heard an interesting story from a common friend. Cyrus and this friend had been sitting by the poolside at the Taj Mahal Hotel in Mumbai, waiting for a table at the Golden Dragon restaurant. Cyrus had just taken over as chairman a few days previously. The manager at the Taj poolside was relatively new. He did not recognize Cyrus and enquired if they were staying at the hotel (because the poolside is reserved for residents). Not once did Cyrus mention who he was. Instead, he got up, apologised and headed over to the lobby to wait for his table at the restaurant. It was his usual humility and correctness at play.

You can imagine how shocked I was when I heard that Cyrus had been guillotined in the Tata Sons boardroom. Knowing Cyrus, one simply had to ask him nicely and create the appropriate circumstances and environment for an honourable exit. He would have quit in a dignified manner, just the way he got up from that poolside table.

During my growing up years, I was fascinated by the Amar Chitra Katha comics. They were filled with stories about historical figures, mythological heroes and religious and social reformers. Whenever these stories touched upon the lives of enlightened individuals such as Buddha, Vivekananda, Guru Nanak or Zarathustra, the illustrators of those comics would place a glowing halo around the character’s head to indicate the fact that the person was an elevated soul. We Indians love doing that even in real life. We mentally place halos around the heads of our political leaders, Bollywood actors, cricketers and godmen. It’s rather foolish but we continue to do it.

That’s precisely the sort of halo that my generation placed around the Tata group and – by association – around its chairmen, be it JRD Tata or Ratan Tata. We always saw the Tata group as a rather different Indian enterprise, one that stood for decency, fairness, conscience, honesty and even social transformation.

That halo faded when Ratan Tata pulled the levers to get the board of Tata Sons to dismiss its serving chairman (with the precision of a meticulously-planned midnight coup). It soon emerged that Cyrus hadn’t been given the opportunity to defend himself during the Tata Sons board meeting. Then, in quick succession, there were letters shot back and forth. By then the halo was barely visible. Then the independent directors of boards of individual Tata companies began expressing their support for Cyrus. The halo seems to have almost entirely disappeared now and, frankly, there will be no winners at the end of this saga.

Whoever said that being Cyrus was easy?

Ashwin Sanghi is the author of The Rozabal Line, Chanakya’s Chant, The Krishna Key, The Sialkot Saga, and the 13 Steps series of self-help books. He co-authored the New York Times bestselling crime thriller Private India with James Patterson.

We welcome your comments at letters@scroll.in.
Sponsored Content BY 

Behind the garb of wealth and success, white collar criminals are hiding in plain sight

Understanding the forces that motivate leaders to become fraudsters.

Most con artists are very easy to like; the ones that belong to the corporate society, even more so. The Jordan Belforts of the world are confident, sharp and can smooth-talk their way into convincing people to bend at their will. For years, Harshad Mehta, a practiced con-artist, employed all-of-the-above to earn the sobriquet “big bull” on Dalaal Street. In 1992, the stockbroker used the pump and dump technique, explained later, to falsely inflate the Sensex from 1,194 points to 4,467. It was only after the scam that journalist Sucheta Dalal, acting on a tip-off, broke the story exposing how he fraudulently dipped into the banking system to finance a boom that manipulated the stock market.

Play

In her book ‘The confidence game’, Maria Konnikova observes that con artists are expert storytellers - “When a story is plausible, we often assume it’s true.” Harshad Mehta’s story was an endearing rags-to-riches tale in which an insurance agent turned stockbroker flourished based on his skill and knowledge of the market. For years, he gave hope to marketmen that they too could one day live in a 15,000 sq.ft. posh apartment with a swimming pool in upmarket Worli.

One such marketman was Ketan Parekh who took over Dalaal Street after the arrest of Harshad Mehta. Ketan Parekh kept a low profile and broke character only to celebrate milestones such as reaching Rs. 100 crore in net worth, for which he threw a lavish bash with a star-studded guest-list to show off his wealth and connections. Ketan Parekh, a trainee in Harshad Mehta’s company, used the same infamous pump-and-dump scheme to make his riches. In that, he first used false bank documents to buy high stakes in shares that would inflate the stock prices of certain companies. The rise in stock prices lured in other institutional investors, further increasing the price of the stock. Once the price was high, Ketan dumped these stocks making huge profits and causing the stock market to take a tumble since it was propped up on misleading share prices. Ketan Parekh was later implicated in the 2001 securities scam and is serving a 14-years SEBI ban. The tactics employed by Harshad Mehta and Ketan Parekh were similar, in that they found a loophole in the system and took advantage of it to accumulate an obscene amount of wealth.

Play

Call it greed, addiction or smarts, the 1992 and 2001 Securities Scams, for the first time, revealed the magnitude of white collar crimes in India. To fill the gaps exposed through these scams, the Securities Laws Act 1995 widened SEBI’s jurisdiction and allowed it to regulate depositories, FIIs, venture capital funds and credit-rating agencies. SEBI further received greater autonomy to penalise capital market violations with a fine of Rs 10 lakhs.

Despite an empowered regulatory body, the next white-collar crime struck India’s capital market with a massive blow. In a confession letter, Ramalinga Raju, ex-chairman of Satyam Computers convicted of criminal conspiracy and financial fraud, disclosed that Satyam’s balance sheets were cooked up to show an excess of revenues amounting to Rs. 7,000 crore. This accounting fraud allowed the chairman to keep the share prices of the company high. The deception, once revealed to unsuspecting board members and shareholders, made the company’s stock prices crash, with the investors losing as much as Rs. 14,000 crores. The crash of India’s fourth largest software services company is often likened to the bankruptcy of Enron - both companies achieved dizzying heights but collapsed to the ground taking their shareholders with them. Ramalinga Raju wrote in his letter “it was like riding a tiger, not knowing how to get off without being eaten”, implying that even after the realisation of consequences of the crime, it was impossible for him to rectify it.

It is theorised that white-collar crimes like these are highly rationalised. The motivation for the crime can be linked to the strain theory developed by Robert K Merton who stated that society puts pressure on individuals to achieve socially accepted goals (the importance of money, social status etc.). Not having the means to achieve those goals leads individuals to commit crimes.

Take the case of the executive who spent nine years in McKinsey as managing director and thereafter on the corporate and non-profit boards of Goldman Sachs, Procter & Gamble, American Airlines, and Harvard Business School. Rajat Gupta was a figure of success. Furthermore, his commitment to philanthropy added an additional layer of credibility to his image. He created the American India Foundation which brought in millions of dollars in philanthropic contributions from NRIs to development programs across the country. Rajat Gupta’s descent started during the investigation on Raj Rajaratnam, a Sri-Lankan hedge fund manager accused of insider trading. Convicted for leaking confidential information about Warren Buffet’s sizeable investment plans for Goldman Sachs to Raj Rajaratnam, Rajat Gupta was found guilty of conspiracy and three counts of securities fraud. Safe to say, Mr. Gupta’s philanthropic work did not sway the jury.

Play

The people discussed above have one thing in common - each one of them was well respected and celebrated for their industry prowess and social standing, but got sucked down a path of non-violent crime. The question remains - Why are individuals at successful positions willing to risk it all? The book Why They Do It: Inside the mind of the White-Collar Criminal based on a research by Eugene Soltes reveals a startling insight. Soltes spoke to fifty white collar criminals to understand their motivations behind the crimes. Like most of us, Soltes expected the workings of a calculated and greedy mind behind the crimes, something that could separate them from regular people. However, the results were surprisingly unnerving. According to the research, most of the executives who committed crimes made decisions the way we all do–on the basis of their intuitions and gut feelings. They often didn’t realise the consequences of their action and got caught in the flow of making more money.

Play

The arena of white collar crimes is full of commanding players with large and complex personalities. Billions, starring Damien Lewis and Paul Giamatti, captures the undercurrents of Wall Street and delivers a high-octane ‘ruthless attorney vs wealthy kingpin’ drama. The show looks at the fine line between success and fraud in the stock market. Bobby Axelrod, the hedge fund kingpin, skilfully walks on this fine line like a tightrope walker, making it difficult for Chuck Rhoades, a US attorney, to build a case against him.

If financial drama is your thing, then block your weekend for Billions. You can catch it on Hotstar Premium, a platform that offers a wide collection of popular and Emmy-winning shows such as Game of Thrones, Modern Family and This Is Us, in addition to live sports coverage, and movies. To subscribe, click here.

This article was produced by the Scroll marketing team on behalf of Hotstar and not by the Scroll editorial team.