Case Studies in Business Ethics and Corporate Governance

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Case Studies in

Business Ethics and Corporate Governance

Sanjay Mohapatra Associate Professor

Xavier Institute of Management Bhubaneswar

India

Sreejesh Surendran Pillai Assistant Professor

IBS Hyderabad India

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To our elders who shaped our lives:

Late Parmananda Mishra Late Dr Sushila Mishra

Dr B. C. Mohapatra H. K. Mohapatra Kanyakumari Mohapatra

Sanjay Mohapatra

AND

Late Surendran Pillai. P Radhamani Amma

And the inspiration behind all my success, Suresh S, Sreeja Sudharman and Sudharman Pillai

Sreejesh Surendran Pillai

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Preface xiii

1. Apple Inc. 1

Apple’s Culture—2 Environmental Record—2 Labor Practices—2 Background—3

Corporate Governance Issues—4 Job’s Resignation 4 Price Cut Strategy—5

Problems 5

Reticent Board of Apple 5 Conclusion—6

2. Anna Hazare: Indian Arab Spring 7

Background —7

Anna Hazare’s Background —8 Anna Hazare: The Second Gandhi —8

Movement: “India Against Corruption (IAC)” —9 Anna’s Movement—9

Phase 1 9 Phase 2 10

Strategies Used in Anna Hazare’s Movement 10 The Dark Side of India —11

Impact of Anna Hazare’s Movement —11 What Went Wrong?—12

We All Are Anna!! —13 What Next? —13 References—21

4. Corporate Governance at Wipro 33

Wipro—34

Corporate Governance—34

Corporate Governance in India—35 Corporate Governance at Wipro—35 Management’s Responsibilities—35

Financial Statements and Disclosures 36 Strategic Planning 36

Annual Operating Plans and Budgets 36

Effective Management and Organizational Structure 36 Setting a Strong Ethical “Tone at the Top” 36

The Indian Software Services Industry—36 Historical Background—36

Characteristics of the Indian Software Industry 37 Current Trends 38

Ethical Issues and Challenges—39 Ethical Dilemma 39

Wipro 41

Ethical Dilemmas Faced by Wipro 41

For Wipro, Is Rape and Murder a Six Sigma? 41 Conclusion—42

References—46

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5. ENRON: Fall of the Mighty 47

US Energy Industry Analysis—47 Natural Gas—48

Enron—48 Background—48

Energy Market Deregulation and Enron—49 Business Diversification and Growth—49 Enron’s Code of Conduct—50

Rise in the Stock Prices of Enron—50

The Alarm Set Off by Bethany McClean: “Is Enron Overpriced?”—50 Issues at Enron—50

Business and Accounting Issues 50 Questionable Practices—52

Top Executives and Their Roles—53

Sherron Watkins “The Whistle-Blower”—53 Fall of Enron—53

Ethical Dilemma—54 Recovery—55 References—56

6. Corporate Governance in ITC LTD. 57

ITC Pvt Ltd.—58

The Company’s Governance Philosophy 60 The Governance Structure 61

The Board of Directors (Board) 61

Corporate Management Committee (CMC) 62 Executive Chairman of ITC 62

Divisional Management Committee (DMC) 62 Divisional CEO 63

Committees 63

Code of Business Conduct and Ethics 65 Whistleblower Policy 66

Conclusion—67 Reference—69

7. Johnson & Johnson: Weathering Turbulence 71

About Johnson & Johnson—72 History 72

1998–2006, Turbulence Started —74 Turbulence Worsens—77

Contents vii

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J&J’s Quality Catastrophe in DePuy and McNeill-PPC 77 References—83

Teaching Note—84

Position in Course 85 Analytical Questions 85

8. News of the World 87

Introduction—87 Background—88

1843 to 1968 88

1969 to 2011 – Keith Rupert Murdoch and His Ownership of NoTW 88 Industry Characteristics—90

Print Media Industry Analysis 90 Porter’s Five Force Model 90 Into the Spotlight—92

The Episode of Phone Hacking of Milly Dowler – “The Last Nail in the Coffin” 93 Links to Police Corruption 94

Defamation Actions 95

Ethical Issues – Where to Draw the Line?—95 Criticism of News International Culture 95

Some Sense Prevails – A New Manifesto for Media Ethics 96

9. Anil Dhirubhai Ambani Group (ADAG) 101

Introduction—101

About Anil Dhirubhai Ambani Group (ADAG)—101 Chairman of Anil Dhirubhai Ambani Group 102 Corporate Governance—102

Corporate Governance at Reliance Group—102 Ethical Issues 103

Insider Trading 105 2G Spectrum Scam 105

Exclusion from Sensex (R-Infra and R-Com) 106 Conclusion—106

References—111

10. Nepotism Over Patriotism: A Case Study on

RIL’s Investment in Oil 113

Introduction—113 Indian Oil Industry—114 Background of Companies —114

Reliance 114

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Reliance Industries Limited 115

Reliance Anil Dhirubhai Ambani Group (ADAG) 115 NTPC 115

Fuel Behind the Fire—115

Different Kind of Gold Plating 116 Selective Pricing by RIL 117 Exploitation through Policy 117 Judgment of the Apex Court—118 RIL Reacts Swiftly—118

References—121

11. Satyam–Maytas: “It’s Not a Coincidence That Maytas

Is Satyam Spelt in a Reverse Way” 123

Introduction—123

Company Background—124 Industry Characteristics—124

Characteristics 124

Challenges Faced by the Indian IT Industry 125 Issues—125

How the Skeletons Came Out of the Closet 125

The Investigation Revealed the “Concealed Truth” 126 Confession Letter: A Brief Description 126

The Allegations against the Company by CBI 127 Ethical Dilemma—127

Corporate Governance—129 Road Ahead 129

Conclusion—129 References—132

12. Subhiksha: Failed Business Model or Unethical Practices? 135

The Subhiksha Saga—135

Business Vision and Mission of Subhiksha—136 Indian Retail Industry: A Story of Transition—136 Business Model of Subhiksha—137

Operations Management at Subhiksha Retail—137 Marketing 137

Promotional Schemes 137 Advertisement 138 The Crew Members 138

Supply Chain Management 138

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Warehouse Operations 138 Logistics 138

Human Resource Management 139 Inventory Management 139 Customer Service 139

Failure of Subhiksha – What Actually Went Wrong?—139 Unplanned Expansion 140

Growth without Consolidation 140 Improper Diversification 140 Economic Slowdown 140 Financial Crisis 140 HR Problems 140

Poor Inventory Management 141 Strong Competition 141

Government Interventions 141 Unethical Trade Practices 141 Financial Health of Subhiksha—141 Corporate Governance Issues—144 Ethical Issues—144

References—148

13. Tata Motors and Singur Controversy: Unethical Practices? 151

Tata Motors Company Background—152 Automobile Industry Characteristics—153 Tata Nano Land Acquisition Issue—154 Costs of Conflict—155

Ethical Dilemma—156 Conclusion—156 References—158

14. Union–Management Tussle at Tata Chemicals Limited 161

The Tata Group—161

About the Company – Tata Chemicals Limited—162 Tata Chemicals Magadi 162

Tata Chemicals Europe 162 Tata Chemicals North America 162 Vision, Mission and Values—162

Vision 162 Mission 163 Values 163

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Company’s Philosophy on the Code of Governance—163

Corporate Social Responsibility by Tata Chemicals Limited—163 Purpose Statements 163

Some Important CSR Initiatives by Tata at Mithapur—164 Natural Resource Management (NRM) 164

“PRAKRUTI” Eco Club Program 164 Other Initiatives 164

The Union’s Tussle at Tata Chemicals Limited—164 The Union and the Management’s Chase 164 Management’s Stand 165

The Tribunal’s Response 165 The Judgment 165

References—171

Index 173

Contents xi

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The relationship between organizations and society has been strong and is the reason for the sustain- ability of an organization. It has been observed that the best companies make a positive impact on their environment. These companies exhibit socially responsible behaviour, which is good for business, not just in ethical terms but also in fi nancial terms. This implies that business decisions that have a good, positive impact on different stakeholders are considered ethical. These ethical decisions do not harm anyone physically or emotionally and are not “draining” on the environment. In other words, these ethical decisions are good for business as well as for all its stakeholders. In the recent past, a trend has been noticed in the different corporate scams. From these scams, it is evident that benefi ts to business can accrue from socially responsible behaviours. At the outset, there could be a high cost associated with these decisions, but the total cost of these decisions in the long run will defi nitely be lower than if “short cuts” are adopted (because these short cuts will increase the cost exponentially in the future in the form of compensation, shutting down the business units, bad image leading to brand deterioration, etc.).

This book, through the collection of cases, is designed to act as a forum for learning through discus- sion and analysis of some of the contemporary issues in this broad area. It is based on contributions from different organizations from a wide variety of domains and geographic regions, leading to diverse views and a stimulating interchange.

The real-life examples covered in this book are from the newspaper (print media), NGOs (working at a policy level), IT industry, utilities, multinationals with diverse interests, FMCG, retail, automobile, chemical and pharmaceutical domains. The real-life cases are based on the experience that these organizations have gone through while implementing different business decisions. The cases illustrate how myopic views in business have tarnished the image of the company, resulting in tremendous loss. These cases serve as “lessons learnt” for students and executives; these lessons can mould their thinking and decision-making process and subsequently impact on business continuity.

For practitioners, using the cases, a framework for designing strategy can be developed. Depending on the industry and the organization, the framework can have the following sections: introduction to the industry; understanding regulatory requirements, where the organization stands in the industry; its vision and mission and use “lessons learnt” from the cases to derive business strategies. These thought processes will help them deﬁ ne business metrics that will go beyond “short-term revenue metrics” to

“long-term sustainable metrics.” These long-term metrics will enhance the prospects of continuity of the business while providing value to its stakeholders.

Note to the professors: Teaching notes for the cases are included in this book. The notes can be ob- tained by contacting your local representative.

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ACKNOWLEDGEMENTS

This book is a collection of cases that have been “class tested” by our MBA students in IBS Hyderabad.

We are very happy that we got the opportunity to teach such a brilliant batch of students (2009–2011) who made learning a memorable and pleasant experience. It would look lengthy to name all the students, hence we have put only some of their names in the Google doc (Business Ethics and Corporate Governance) and pray to the Almighty for success in their professional and personal lives.

We would also like to thank our family members for their unstinted and continued support through every stage of our lives.

Finally, to God, who made it all possible.

Dr Sanjay Mohapatra Prof. Sreejesh Surendran Pillai

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Apple Inc. is an American multinational fi rm. Its main area of work is designing, manufacturing and developing consumer electronics and personal computers as well as creating software products. Steve Wozniak and Steve Jobs founded it on April 1, 1976. It has its headquarters in Cupertino, California, USA. Apple Inc. was previously known as Apple Inc. Computers in 1976 but changed its name to Apple Inc. in 2007 so as to refl ect its diversifi ed portfolio of products.

Apple Inc.

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Apple Inc.’s hardware products include Macintosh Computers, iPod, iPhone and iPad. The software products consist of Mac OS X operating system, iTunes media browser, iLife suite of multimedia and creativity software, Aperture – photography package for professional purpose, Logic Studio and iOS – an MOS (mobile operating system). The iconic products among the above are Apple iPod, iMac and iPhone. They have earned a reputation of high quality and premium prices. Apple Inc. was given the 121st rank in the Fortune 500 list in 2007.

As of Financial Year 2010, the company has earned revenues of US$ 65.23 billion, operating income of US$ 18.39 billion, proﬁ t of US$ 14.01 billion, assets of US$ 75.18 billion and equity of US$ 47.79 billion. The total number of employees is 49,400 in Apple Inc., of which 46,600 are full time and the rest are temporary. Apple is one of the largest companies by market capitalization and the most valuable technology company in the world. Apple surpassed brieﬂ y ExxonMobil on August 9, 2011, and became the most valuable company in the world. Apple has been named the most admired company by Fortune magazine in 2008, 2009 and 2010.

APPLE’S CULTURE

Apple was one of the few companies established in 1970s which went against the traditional norms of organizational structure. The organizational hierarchy was ﬂ at and casual, which reduced the unneces- sary bureaucratic controls and freed the decision-making process in this process. Apple’s culture has been much inﬂ uenced by its founders. It is said that even after Apple became a Fortune 500 company, Steve Jobs walked around the company barefoot.

Apple encourages excellence and individuality among its employees. It assigns challenging goals which go a long way in motivating the workforce. It has earned the reputation of attracting the most tal- ented employees. Apple has also made it a point to award the best performers who have made excellent contributions in the ﬁ eld of technology and leadership. Apple has instituted Apple Fellow Program for the same purpose. Such a healthy culture motivates the employees to work diligently for the attainment of the ﬁ rm’s objectives.

ENVIRONMENTAL RECORD

Apple has always been in the thick of environmental controversies. It has many issues like non-recycla- ble components of hardware and toxins within the iPhone hardware. Apple has also been criticized for the inclusion of PVCs and BFRs in its products. Institutions like Greenpeace and Climate Counts kept a close look on the activities of Apple. There were also issues like refusal on the part of Apple’s management to share information regarding the handling of chemicals and supply chain communication. Apple took a number of steps in addressing the environmental issues like removal of PVCs and BFRs from its products, replaced CCFL (cold cathode ﬂ uorescent lamps) with mercury-free and arsenic-free LCD displays and offered information about emissions, electric usage and materials.

LABOR PRACTICES

Reports were made about the unethical and exploitative labor practices followed in some factories assembling iPods in China. The employees and workers there were made to work more than 60 hours a week. In some factories they were forced to stay in the factory premises and the rent and food expenses were deducted from their salaries and wages. Even the wages were not commiserating the hard work done.

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Apple Inc. 3

Apple came heavily on such suppliers. It launched investigations and yearly audits for ensuring that the workers’ rights were preserved. The progress made in this aspect was reported frequently so as to inform its compliance to all its stakeholders.

BACKGROUND

Apple Computer Inc. is credited for the huge growth of the personal computer industry during the 20th century. Products like Macintosh gave it the tag of an innovator and the products were also re- nowned for their ease of use. The company designs, manufactures and markets PCs, software and other products focusing on ease of use and unique design.

Apple was founded in April 1976 by Steve Wozniak and Steve Jobs aged 26 and 21, respectively, both being college dropouts. They both started working several years ago when Wozniak began building boxes which allowed him to make long distance telephone calls for free. They sold hundreds of those boxes.

In the year 1976, Wozniak who was then working on the Apple I computer without a keyboard or power supply joined hands with Jobs to start a company by selling some valuable possessions and a van for

$1300. They sold 50 such computers to a local retailer and 200 to computer hobbyists in the San Fran- cisco Bay area for $666 each. Later, Wozniak started working on Apple II, designed to appeal to a greater market. They hired local computer enthusiast students to assemble circuit boards and design software. To cater to the general public they decided to house Apple II in attractive modular beige plastic container.

In order to create a large organization, Jobs partnered with Mike Markkula who had worked with Intel Corporation and Fairchild Semiconductor. Chairman Markkula had one-third share of the company with a capital investment of $250,000. In 1977 Jobs also hired Mike Scott as the president. He also recruited Regis McKenna from the Silicon Valley to devise an advertising strategy. The Apple logo was designed by McKenna. The professional marketing team placed Apple II in retail stores by June 1977, and the annual sales reached $1 million. The earliest model read and stored information on cassette tapes, which were unreliable and slow which lead to the invention of Apple Disk II in 1978 by Wozniak.

These were the cheapest and fastest disk drives during that period. To expand beyond the hobbyist market, Apple II was introduced with a user manual and was launched at a consumer electronics show. By 1978 the company was growing rapidly and its products had over 100 dealers.

In 1979 various new and improved products were launched such as Apple II, Silentype, VisiCalc, etc. By the end of 1979 sales rose 400% since 1978 to over 35,000 computers. Apple Fortran was launched in the year 1980 which further led to the development of technical and education platforms. It went public in 1980 with the offering of 4.6 million shares ($22 each) which were sold out in minutes.

It made a second offering in 1981 of 2.6 million shares. Fearing that Apple II would be soon outdated, Apple pushed the launch of Apple III with more memory and better graphics, though the sales of Apple II doubled to 78,000. Apple III did not match the success of Apple II and the production was stopped in 1984, this lead to the decision of laying off employees by Mike Scott, which was not liked by Steve Jobs. Subsequently, Mike Markkula became the President, Steve Jobs became the Chairman and Mike Scott was named the Vice-Chairman prior to his leaving the ﬁ rm.

Despite the issues, the research budget grew thrice, 40 new software were released, new offi ces were started in Europe and in 1982 Apple Inc. became the fi rst PC Company to touch the sales fi gure of $1 billion annually.

After losing the contract with IBM, Apple designed Lisa to challenge IBM. This was the ﬁ rst computer which had a mouse and displayed graphics on the screen. This showed how determined Jobs was to design computers for the common man. But, Lisa performed below expectations and John Sculley (former president of Pepsi-Cola) replaced Mike Markkula as the president of Apple Inc.

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After the failure of Lisa, Macintosh was seen as the future of the company. It offered Lisa’s innovations at a very low price. It was the people’s computer. Launched by a TV commercial, it was priced at $2,495 and included a 3-inch faster hard drive instead of a 5-inch hard drive. In 100 days 70,000 Macs were sold.

Despite its success, the sales of Mac fell. The company also faced troubling internal problems. There were clashes between divisions and low inventory tracking led to overproduction. Sculley reorganized Apple and many executives including Jobs left the organization. Steve Jobs then founded a new company called NeXT Inc. which later turned out to be the rival of Apple.

While competing in the market Apple was involved in numerous lawsuits. In December 1989, Xerox fi led a lawsuit against Apple for using Xerox technology. Apple did not deny the same but explained that it had to invest a large amount of effort and money to refi ne the technology. Apple fi led a few lawsuits against Microsoft and HP charging copyright infringement. This led to the ruling that “Copyright protection cannot be based on ‘Look and Feel’ alone; rather ‘specifi c’ features of an original program must be detailed by developers for protection.”

Sculley felt that user-friendly graphics were no longer the unique selling point and Apple needed to launch smaller, cheaper models. It launched Classic and LC which were a hit. Apple’s market share was 11% in 1990 and rose to 19% by 1992. The most pressing issue for the ﬁ rm was capable and consistent management instead of technology. Sculley’s successor Michael Spindler launched Power Macintosh.

He failed to estimate the demand for the product and by 1995 Apple’s unﬁ lled orders were worth about

$1 billion. He handed over the reins to Gil Amelio.

In 1996, Apple bought NeXT for $377 million. Later Steve Jobs was named the interim CEO. Jobs continued with the same passion and restructured the organization. Owing to his restoration efforts the fi rm became profi table again. Annual sales touched $11.5 billion in 1995. In 1999 profi ts recorded were

$601 million. The stock showed a turnaround rising 140% to $99 per share. Jobs then became the per- manent CEO and Apple could look forward to a consistent growth.

CORPORATE GOVERNANCE ISSUES Job’s Resignation

Corporate governance at Apple has remained a problem from the past. Apple, which was established by Steve Jobs, Steve Wozniak and Ronald Wayne in 1976 to sell a computer kit, became an electronics gi- ant in the USA under the innovative and charismatic leadership of Steve Jobs. But things started becom- ing little rough for Apple in 1984 when Steve Jobs introduced Macintosh. Initial sales for Apple Macin- tosh were encouraging, but later, sales started deteriorating. There were many problems at that time for Apple, for example no hard disk, high price, absence of appropriate software. With these incidents as background, an internal tussle started at Apple between Steve Jobs and John Sculley, who was CEO at that time. Mac’s sales were decreasing and Apple was going to report the ﬁ rst ever quarterly loss in its history. Taking leverage of this problem, Sculley initiated his attempts to deprive Steve of his powers.

Sculley wanted Jobs to represent Apple externally as a new chairman who will not be able to inﬂ uence the core business policies. Sculley told the board: “I’m asking Steve to step down and you can back me on it and then I take responsibility for running the company, or we can do nothing and you’re going to ﬁ nd yourselves a new CEO.” A major portion of the board supported Sculley and removed Jobs. On May 31, 1985, Jobs lost his duties and was moved to the chairman position. In September, Jobs left the company and he founded NeXT Computer with few other ex-employees of Apple. “I feel like some- body just punched me in the stomach and knocked all my wind out. I’m only 30 years old and I want to have a chance to continue creating things. I know I’ve got at least one more great computer in me. And

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Apple Inc. 5

However, after Jobs left Apple he didn’t give up, in fact he considered it as a new beginning. Jobs started a new company named NeXT computers in 1985. He also acquired an animation company in 1986, which he later named as PIXAR, which later produced many high grosser animation movies of Hollywood like Toy Story, Finding Nemo, etc. In 1996 when Apple was struggling to save its name, CEO Gil Amelio chose to buy NeXT computers in order to get Jobs back. In 1997, Amelio was ousted by board members because of three years of continuous low stock price of Apple shares. After this Jobs became the interim CEO of Apple and started his work again. This incident clearly reﬂ ects a corporate governance problem at Apple.

PRICE CUT STRATEGY

Following the development of the mobile industry the iPod market leader Apple changed its direction and entered the mobile segment with the launch of the iPhone on 29 June, 2007. With the launch of Apple iPhone, Apple’s name in the mobile market came as a threat to competitors because they were aware of the loyalty of customers towards the brand name of Apple in the iPod market. The iPhone had plenty of features including the iPod dock. Its competitors like Samsung, Nokia, LG and BenQ-Siemens were all ﬁ ghting hard to regain the market share in the highly volatile mobile market, and with Apple’s entry the competition got worse. Apple launched the iPhone with 8-GB and 4-GB models (with 4-GB till supply lasting). The major issue that came in with the launch of iPhone was pricing and features;

the 8-GB model on its launch was priced at $599, and within 68 days of its launch the price was slashed to $399, a complete $200 reduction of price. This really was a bad move among its loyal customers as there were customers who had purchased the iPhone at the launch price and started complaining after the price cut and with this decision, the share market value of Apple also dropped.

Steve Jobs and Steve Wozniak, the founders of Apple sent letters with apologies to its customers, and also refunded $200 to customers who had purchased iPhone 14 days before announcement. Yet, there were huge protests, customers ﬁ led cases against the company, and Steve Jobs had to solve these issues to maintain the market.

Problems

First, with the price cut Apple lost some its ﬁ rst buyers and loyal customers.

The shareholders also had a loss as Apple share prices dropped after the announcement of price cut.

The competitors also started working on new models in competition to iPhone at the time of price cut.

Apple was one company that always believed in higher price at the time of launch and favoured price skimming; the sudden move towards market penetration was also not welcomed by all its customers and investors.

Reticent Board of Apple

Apple’s Board has always been criticized for not communicating key issues to stakeholders properly.

It has been exclaimed repeatedly that Apple Board was too close to Jobs. Apple Board has seven members, which is too small for a company like Apple and many of them have personal connection with Jobs.

Transparency is one of the main factors required in corporate governance, because whatever important issue is there within the company should be properly communicated to its shareholders. This is where the Board of Apple failed. This is quite evident from the fact that Jobs was battling from cancer and related effects since 2004, but the Board was never very communicative about this issue. Apart

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from this the Apple Board never came out with their succession plan. This was one of the major issues which again generated many questions about the corporate governance policy of Apple.

According to an article in the Fortune magazine’s online edition, there were strong indications that a few members of Apple’s Board of Directors were in search of a suitable successor for Jobs. This search was being done in an informal way, which should not be the case. However, according to spokeswoman Katie Cotton, Apple Board had been working on the succession plan for several past years. They did not disclose this because they felt that they may lose the competitive edge to their rivals. When Jobs was on leave for health reasons, 30% of its shareholders demanded the plan as to how Apple are going to manage in case Jobs did not return as CEO.

On 24 August, 2011, Steve Jobs resigned from the post of CEO of Apple and COO Tim Cook replaced him. However, Jobs remained as the chairman of the company, which actually boosted the share- holder’s morale. However, it cannot be denied that the Board’s corporate governance policies lacked transparency and proper communication.

CONCLUSION

Apple, being a part of the elite group of Fortune 500 companies, has an added responsibility to take extra care of all its stakeholders to maintain and improve its position. Over the years, Apple’s consistent radical innovation and superior product design aspects have helped the company to be voted as the most admired company by Fortune magazine in 2008, 2009 and 2010.

In the present everchanging scenario with stronger regulations and more focus on ethical and environmental issues, the company needs to be more transparent in its operations while keeping their internal competitive strengths under wraps. The company should look at its operations to make them environment friendly, make its suppliers and product assemblers follow strict company guidelines on labor practices and related issues. Yearly audits with intermittent checks, if implemented, will go a long way in establishing the image of the company as ethical and environment friendly company.

Succession planning is one area where Apple should focus. Jobs leaves behind a lesser known successor as the CEO of the company – Tim Cook – who has huge shoes to ﬁ ll. Good corporate governance requires the company to groom prospective leaders for the challenges ahead; Apple should abide by the policy of looking at the new talent – in-house as well as outside, to take the company forward as and when the need arises for change.

Being a radical innovator, the company faces the problem of copyright infringement and copy cats.

This reduces the lifecycle of its products and requires the company to come out with more and more innovative products in lesser time gaps to maintain and improve its market share. R&D and Pricing de- partments face an uphill task to come out with new innovative products with effective pricing strategies for proﬁ t maximization through price skimming and market penetration.

Apple’s improvement in corporate governance practices requires more transparency and proper communication with its stakeholders so as to maintain the effectiveness of its operations while taking the company forward.

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The dream of India as a strong nation will not be realised without self-reliant, self-sufﬁ cient villages, this can be achieved only through social commitment and involvement of the common man.

– Anna Hazare The gap between the rich and the poor is increasing. Some are living to eat, while others are struggling to eat enough to be able to live. “Social activist and a lonely voice for the Indian poor – Anna Hazare is currently on a ‘fast unto death’ to improve the proposed anti-corruption Lok Pal Bill.”

– Source: Zee News The Wall Street Journal reported on the tweets supporting Anna Hazare on social media site Twitter.

“Corruption scandals have rocked the country in the past few months leading to a general mood of hopelessness,” assesses Channel News Asia. India ranked 87th out of 178 countries in the 2010 Corruption Perceptions Index conducted by Transparency International.

BACKGROUND

The Arab Spring was ignited in December 2010 in Tunisia as a consequence of self-immolation of Mohammed Bouazizhad, a vegetable seller, against police corruption and ill-treatment. This pro-democracy uprising had several cascading effects, as social unrest shook Egypt, Algeria, Jordan and the rest of the Middle East and North Africa. The result of this movement was the ouster of the Tu- nisian president Zine el Abidine Ben Ali. The “spring” stands against the “winter” of oppression faced by the Arabs in the past.

Anna Hazare’s protest against corruption in India, which initially started with his ﬁ ght against corruption by his fast unto death, later took the shape of a great movement comparable with the nonviolent movement during India’s independence led by Mahatma Gandhi.

Anna Hazare: Indian Arab Spring

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ANNA HAZARE’S BACKGROUND

Kisan Bapat Baburao Hazare, commonly known to us as Anna Hazare, is a 73-year-old activist who has been standing in between India’s government and civil society for fulﬁ lling of the terms and conditions of an anti-corruption law.

He belongs to Ralegan Siddhi village situated in western Maharashtra; born in a family of unskilled laborers and was raised in Mumbai by one of his aunts. He then joined the Indian Army in 1963, heeding a patriotic call by the government after Indian forces were defeated in a war with China.

Anna came across two major incidents which marked the turning points in his life. One was when he accidentally came across a book by Swami Vivekananda at the New Delhi railway station. The book showed him that the ultimate motive of human life should be service to humanity. The second incident was way back in 1965 when he narrowly managed to escape alive during a Pakistani air attack at the Indian border post, which had cost the lives of all the servicemen except Hazare. After this incident he took an oath to dedicate his life to public service.

In 1978, he took voluntary retirement after serving for 15 years of his life to the army and returned to his village, Ralegan Siddhi. For the next few years, he aimed at the development of his village and gained a lot of recognition for his work at the state as well as at the national level for having transformed an impoverished, drought-prone village to a prosperous “model village” by opting various steps for sustainable farming and rural life.

In 1991, he started Bhrashtachar Virodhi Jan Aandolan (BVJA), a public movement against corruption. It was found that 42 forest offi cers had swindled the state government of crores of rupees, which he proved with appropriate evidence. However, no action was taken on those offi cers as a minister in the state government was also said to be involved. This caused him great distress; he returned the Padmashree award given to him and went on a hunger strike. Perhaps, the government was forced to take action against the corrupt offi cers, as a result of which six ministers were forced to resign and close to 400 government offi cers were rusticated.

In 1977, he started his ﬁ ght for the Right to Information Act and found that the government was not in favour of passing the law even after years of struggle. Anna again chose the path of hunger strike, and after 12 days of his indeﬁ nite hunger strike the President of India signed the draft of Right to Information Act and ordered the state government to implement it with effect from 2002. The same draft was considered as the base document for the making of the National Right to Information Act-2005.

On 5 April 2011 Anna started his second freedom struggle and this time it was against corruption. He and his committee have drafted a bill namely the Jan Lokpal. Anna again used his nonviolent weapon, hunger strike, to ﬁ ght against corruption from 5 April 2011 at Jantar Mantar in Delhi, to pressurize the government to form a joint committee of the representatives from both the Government and the civil society to draft a new bill which would include strong punitive action and more independence to the Lokayuktas and Lokpal (Ombudsmen in the states) (Exhibit III).

ANNA HAZARE: THE SECOND GANDHI

One of the main reasons for comparisons of Anna Hazare and Mahatma Gandhi is that: Hazare’s ﬁ ght against social and political irregularities have always had a nonviolent approach, which draws a comparison with Mahatma Gandhi. Some other apparent similarities with that of Mahatma Gandhi is the method of agitation, attire and belief in nonviolence.

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Anna Hazare: Indian Arab Spring 9

Anna has advocated the Gandhian ‘Jail Bharo Aandolan’ (courting arrest) and has of late also given a clarion call of ‘lao ya jao’ resembling the ‘Do or Die’ of the Gandhian times and the results of these methods are still awaited (though the movement was successful, it is yet to be implemented).

However, the movements led by Anna and Gandhi differ in their scale, agenda, targets, social strata of followers, methodology, technology, times, space and personalities involved. Even though there appears to be a similarity at the ground level, there is a disconnect behind, which the forces of Anna are trying to unify and voice.

Anna Hazare, similar to Gandhi, used the method of fast-unto-death to persuade the government to address his concern but the fundamental difference between the methods of the two is that Gandhi undertook fast to unite people against the Britishers unlike Anna who has used it as a means to pressurize the government to come to action. Also, coming from an aristocratic background, Gandhi was able to gain support from the lowest rungs of the society, whereas Anna’s appeal seems to be limited to the urban middle class.

MOVEMENT : “INDIA AGAINST CORRUPTION (IAC)”

The ﬁ rst to propose the idea of a Lokpal was Shanti Bhushan, a former Union law minister who submitted a bill to the Parliament in 1968. Since 42 years, the government-drafted bill has always failed to pass through the Rajya Sabha, which is the upper house of the Parliament of India. The Lokpal Bill was ﬁ rst passed in the 4th Lok Sabha in 1969, but stalled in the Rajya Sabha. Subsequent Lokpal Bills were introduced in 1971, 1977, 1985, 1989, 1996, 1998, 2001, 2005 and 2008, all of which failed to pass.

Arvind Kejriwal, the architect of Anna Hazare’s anti-corruption campaign, framed the Lokpal Bill in the autumn of 2010 after discussing the fi ner legal points of the Bill with Supreme Court lawyer Prashant Bhushan and his father Shanti Bhushan. By the end of October, Kejriwal had begun to circulate a draft of his bill among “like-minded people” and started to work with those who responded positively, including Kiran Bedi, the Ramon Magsaysay Award-winning police offi cer-turned-activist, and the former Supreme Court Justice Santosh Hegde. He tried to fi nd people to support him who were known for fi ghting against corruption.

One such person that he happened to cross paths with was Anna Hazare. By December 2010, when the group now calling itself India Against Corruption (IAC) sent a draft of its Lokpal Bill to Prime Minister Manmohan Singh and demanded a “total overhaul of the anti-corruption delivery system”, Hazare was among the signatories. After several months of no response from the government, Kejriwal and Bedi ﬂ ew to Maharashtra in February to meet Hazare. Anna Hazare was convinced and found this to be a good solution to ﬁ ght corruption.

ANNA’S MOVEMENT

Anna’s movement can be divided into two phases.

Phase 1

On 5 April 2011, Anna Hazare started a “fast unto death”, to exert pressure on the Government of India to enact a strong anti-corruption act as envisaged in the Jan Lokpal Bill. It is a law that will establish an Ombudsman that will have the power to deal with corruption in public ofﬁ ces.

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The movement attracted attention very quickly through various media. This movement has also been joined by many people providing their support over social media such as Twitter and Facebook. As an outcome of this movement, on 6 April 2011 Sharad Pawar resigned from the Group of Ministers formed for reviewing the draft Lokpal Bill 2010.

On 7 April 2011, Anna Hazare and his team called for a Jail Bharo Andolan with effect from 13 April to protest against the Government’s rejection of their demands. He claimed that his group has received 60 million text messages offering support and that he had further backing from a large number of Internet activists. The outburst of support was largely free of political overtones as political parties were speciﬁ cally discouraged to participate in the movement. The fast ended on 9 April, after 98 hours, as the Government had to accept most of the demands due to public pressure. Anna Hazare then gave a deadline of 15 August 2011 for the passing of the bill in the Parliament, on failing of which he would start a hunger strike from 16 August, the very next day. The fast also helped in leading the Government of India to agree to setting up of a Joint Drafting Committee, which would complete its work by 30 June.

Phase 2

By 15 August the Joint Drafting Committee failed to reach a conclusion and the ﬁ ve members of the Government on the panel came up with their own versions of the bill. This bill was considered by Anna and his team as weak and they felt that the corrupt would go free apart from several other differences. To protest against this, Anna Hazare announced an “indeﬁ nite fast”. Anna and his team asked for permission from Delhi Police for their fast and agitation at Jantar Mantar. Delhi Police granted permission with certain conditions. These conditions were considered as restrictive and against the fundamental constitutional rights by Team Anna. Therefore, they decided to defy the conditions.

On 16 August, Anna Hazare was taken into preventive custody by Delhi Police. Anna, before his arrest, asked his supporters to continue with the agitation and urged the protesters to remain peaceful. Other members of “India against Corruption”, Arvind Kejriwal, Kiran Bedi and Manish Sisodia were also taken into preventive custody. Kiran Bedi described the situation as resembling a kind of Emergency (referring to the Emergency imposed in 1975 by the Indira Gandhi Government).

The arrest resulted in huge public outcry and under pressure the government had to release Anna on the evening of 16 August. However, Anna Hazare refused to come out of jail, starting his indeﬁ nite fast from jail itself. He refused to be released till he is given a written, “unconditional permission”.

Unwillingly, the jail authorities had no option but to let Anna spend the night inside Tihar jail. Later on 17 August, Delhi Police permitted Anna Hazare and his team to use the Ramlila Maidan for the proposed fast and agitation withdrawing most of the arguable provisions they had imposed earlier. The indeﬁ nite fast and agitation began in Ramlila Maidan, New Delhi, and went on for around 288 hours (12 days from 16 August 2011 to 28 August 2011).

Finally, the bill was passed by the government whose key features were lowering the bureaucracy, inclusion of the Prime Minister and including CBI’s anti-corruption wing in the Lokpal ambit. Other major features are discussed in Exhibit V.

Strategies Used in Anna Hazare’s Movement

Anna and Kejriwal planned the fast unto death Hazare would stage in April at Jantar Mantar; they delib- erately selected a date that would fall between the end of the Cricket World Cup and the start of the In- dian Premier League. Kejriwal’s calculation was that the fast must continue through Saturday, because he knew the working class could join them only on weekends—and that is exactly what happened.

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“Each and every line of our communication material is discussed, because the ﬁ nal material has to be very sharp”—they had an acute sense for what it takes to persuade and mobilize the public. Social networking sites were ﬂ ooded with discussions on Anna Hazare’s movement, his latest updates and his next move. They strategized using toll-free phone lines, online polls and social networking sites to target educated people.

THE DARK SIDE OF INDIA

It is alarming when we look at the corruption perception index of Transparency International, which has downgraded India from the 84th position in 2009 to the 87th position in 2010. Corruption today is prevalent in all sectors of the economy right from power and energy to defense. However, a survey conducted by KPMG showed that the most prone sector to corruption is the real estate and construction followed by telecommunications. The total amount of capital involved in various scams in India over the last 12 years is as huge as US$ 1.80 trillion. The present value of India’s total illicit ﬁ nancial ﬂ ows, as per the GFI report is US$ 462 billion which stands to be much more than India’s foreign exchange reserves which remained at US$ 316.6 billion towards the end of August 2011 (Exhibits IV, V, and VI).

IMPACT OF ANNA HAZARE’S MOVEMENT

Though successful, it was not easy for a septuagenarian to gain the appreciation and acceptance in a populous country of over 1.2 billion people. It must have been a hard effort to have the support from the world superpower and others over the world. Seventy-four-year-old Anna Hazare has successfully lit the ray of hope and desire for every individual to make India a better place to live. The period of Anna’s fast proved to be more auspicious than any of the festivals celebrated as it was successful in gathering Indians from diverse backgrounds of religion, caste, community, age group and other sociodemographic factors. Among the huge number of supporters, the Muslim community also joined hand-in-hand in Anna’s crusade against corruption and enacting a strong effective Lokpal Bill. NRI supporters were found taking out rallies in support of Anna’s movement in masses from Los Angeles, Dallas, and Texas, in the United States. Hazare, a social activist was more than successful in attracting a crowd of more than 60,000 people at the Ramlila Maidan, not for any promised personal gain, but for a social cause.

Anna successfully made an impact on the youth as well. College students from Chandigarh, Bangalore and many other cities showed support to Anna Hazare by taking out rallies in his support. The students of Indian Institute of Management, Bangalore, to show solidarity with the protest, skipped a meal and also did not accept their convocation from the Prime Minister as scheduled, expressing their displea- sure.

All types of media were channelized to cover this event when masses had gathered all along with their families considering this to be the revolution not seen before and wanted to be a part of which after all it was making headlines in the country and around the world for days together.

The government seemed to have mishandled the situation by arresting Anna Hazare. An Economic Times (www.economictimes.indiatimes.com) poll of 43 CEOs across India has showed that 84% of them were of the opinion that the government has mishandled the situation, 9% denied any kind of mishandling by the government and 7% refused to give any response. It was seen as a sorry state of affairs when the Prime Minister proudly said that his integrity is unquestionable but could not say the same for his party.

In Chhattisgarh’s Naxal heartland of Bastar, people from the interior areas of the Naxal-infested district participated in the rally in support of Anna Hazare’s crusade against corruption. Such supporters

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were seen in huge numbers throughout the country. Also many states had observed bandhs (meaning closure of establishments) on the same day that Anna was arrested.

The movement also had political intricacies, with the BJP and Shiv Sena supporting the cause. The UPA government felt the pressure within, whereas the BJP got a chance to criticize the government and revive its position (research also suggested that if elections were to be conducted during this movement BJP had a better chance of winning (www.economictimes.indiatimes.com)). The second Gandhian movement seemed to have its effect throughout the world as Sensex had dropped by 371 points on 19 August since the unrest had resulted in loss of faith and conﬁ dence of the market investors in the central government.

Anna’s movement inspired other countries and also activists like Ansar Burney, a Pakistani who declared to organize a campaign after Eid-ul-Fitr against corruption and terrorism in Pakistan after analyzing the success of Anna’s ﬁ ght against corruption in India that pulled the crowds in support of the cause (Exhibits I and II).

WHAT WENT WRONG?

As per the Constitution of India the legislative procedure for passing a bill requires the proposed bill to be passed by both the houses, i.e. the Lok Sabha and the Rajya Sabha, whereas Anna, with his movement, compelled the Government to make decisions in an unconstitutional way. Moreover, many people accused Anna of blackmailing the Government by his movement. Also, his movement was found to be apparently dominated by urban middle class and youth, as farmers, labourers and tribals who are a signiﬁ cant population of rural India were not part of the movement.

Critics like Chandrabhan Prasad, Kancha Ilaiah, dalits and communist said that “Anna and the movement for Lokpal bill” was rejecting representative democracy as the movement was perceived to be an upper caste uprising against India’s political democracy. They believed that the minorities had no interest in Anna’s movement as it had reﬂ ected an upliftment for the upper caste only. Also, another activist wasn’t allowed to undertake fast unto death at Ralegan Siddhi, reserving this sole right to Anna Hazare. Similar was the case with Udit Raj, another activist, who was told to follow Anna’s path rather than starting a parallel movement.

Also the Government seemed to accuse Anna for making communication diffi cult by staying behind the fi rewall during his fast unto death movement. Mostly, the communication was dependent on the associates. Anna’s arrest at New Delhi had triggered a rage amongst the followers, since such a curb on public protests by the government were not even prevalent during the British period. Arun Jaitley termed this act of government as “disappointing” and “not inspiring confi dence”, concluding that whole India was agitated against the UPA level of corruption.

Anna’s initiative and his movement to control corruption had ignited the dormant volcano residing deep inside an Indian, united people from all spheres but failed to maintain the same ﬁ re amongst its team called Team Anna. Anna was criticized as stubborn in his demand, when he refused to honour the request of the Prime Minister to break his fast on the 10th day which gave rise to a conﬂ ict amongst the members of the team itself. Swami Agnivesh, a member of team Anna accused his fellow members of having conspired against him by putting forward the CD in which he was asking a Union Minister to act tough with Anna Hazare. Team Anna could not stand to be one voice and did not communicate one message and more importantly did not communicate Anna’s message making the victory of Team Anna questionable.

Government targeted the Team Anna members Kiran Bedi and Arvind Kejriwal accusing them of using offensive words against the Government, which was captured in a news channel and hence were

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served with the “breach of privilege notice” for the deed. Moreover, Digvijay Singh (Congress General Secretary) also accused Arvind Kejriwal of disregarding the government rules and regulations and also of misusing his NGO to stack up his huge wealth. In a dramatic turn, within two days of Digvijay Singh’s accusation, Arvind Kejriwal was served an income tax notice of Rs 9 lakh for violating the terms related to his resignation from Indian Revenue Service (where he was working before he took over the role of an activist) in February 2006. Several questions were raised on the timing of the notice which was issued after a span of 5 years after he started as a crusader as a strong member of Team Anna.

There were doubts if it was purely incidental or intentional that all these people who were raising their voices against the government were targeted by the government machineries.

With Anna Hazare’s movement gaining popularity, masses exactly did not notice much about activists like Irom Sharmila from Manipur (a state in Northeastern province of the country) who has been on fast since 10 years ﬁ ghting against an issue related to Indian Armed Forces’ Special Powers Act (AFSPA). Leaders like Aruna Roy had also come up with some recommendation related to Jan Lokpal Bill which also did not catch the attention of the crowd. It was difﬁ cult to gauge whether the people of India were supporting Anna Haraze’s courage to start such a movement at the age of 70+ or they were in favour of the actual Jan Lokpal Bill.

WE ALL ARE ANNA!!

The good thing about Anna Hazare’s movement is the triumph of Indian democracy. It has been a clear victory for the people of India. It has been proved that lobbying for better and stronger laws is no longer the preserve of politicians, NGOs and businessmen. It is a warning to the political class, which is largely seen to be sluggish, corrupt and disconnected. Anna Hazare’s movement was like a much-needed reality check for the Indians. Moreover, it is just the beginning of an extensive struggle against corruption, which has sunk deep roots in one of the world’s most uneven and hierarchical societies. It was a feel good factor for the Indians to be a part of such a movement as corruption is one of the major issues that has been bothering the common man. Moreover, this movement inspired the youth to join politics and make a difference to the nation

WHAT NEXT?

On one hand we talk about globalization and India to be the second fastest growing economy and on the other hand there are questions whether we are still in an era where no one can touch the powerful and the common man is meant to suffer. There are voices questioning if British imperialism still exists with a difference of the whites being replaced by the browns. India is a democracy which by default gives a fundamental right to the citizens of a country to expect the interests of their elected representatives to align with those of its citizens who brought them to power, the vested interest here being a corruption- free country. This has put the political prestige and pride of being the largest democratic nation in the world at stake. This as well has huge economic repercussions in terms of FDI and the conﬁ dence of investors around the world.

After having been rejected for eight times since 1969, is it the time now for the Lokpal Bill to be passed? Anna has deﬁ nitely struck the chord with millions of Indians from all walks of life who have backed him. The underlying question here is whether it is Anna’s cause (corruption free country) and means of getting the cause addressed (Gandhian style of protest) that is drawing public support or it is really the Jan Lokpal Bill of Anna. Is there really a need for any bill or is it the implementation and

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functioning of the already existing bills intending to do the same which is a concern. The cause of the bill is to ﬁ ght corruption but is Lokpal a solution at all and if it is so, then is Jan Lokpal the solution at all.

EXHIBIT I: Anna Hazare’s nonviolence movement towards corruption is undoubtedly for a common benefit of Indian people yet it failed to undergo the constitutional way

EXHIBIT II: Anna Hazare during his fast

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EXHIBIT III: Honors, awards and international recognition

Year of Award or Honor Name of Award or Honor Awarding Organization

2008f Jit Gill Memorial Award World Bank

2005 Honorary Doctorate Gandhigram Rural University

2003 Integrity Award Transparency International

1998 CARE International Award CARE (relief agency)

1997 Mahaveer Award

1996 Shiromani Award

1992 Padma Bhushan President of India

1990 Padma Shri President of India

1989 Krishi Bhushana Award Government of Maharashtra

EXHIBIT IV: Scams till date in India

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Exhibit V: The following table compares the Lokpal Bill as introduced by the government, the Bill drafted by the nominees of Shri Anna Hazare and the Amendments suggested by National Campaign for People’s Right to Information (NCPRI).

Issues Lokpal Bill, 2011 (Government Bill)

Draft Jan Lokpal Bill, 2011 (Anna Hazare)

Amendments of NCPRI (Aruna Roy)

Investigation On receiving a complaint against a public servant, the Lokpal shall either itself or direct its investigation wing to conduct a preliminary investigation within 30 days. The inquiry shall be completed within Six months. It may be extended for six more months after the Lokapl give reasons in writing.

No sanction shall be required by the Lokpal to inquire any complaint

The CBI, when investigating cases under the Prevention of Corruption Act 1988, shall be Under the Lokpal.

Investigation has to be completed between 6 to 8 months.

Investigation in complaints made by whistleblowers, who are in danger of victimization, shall be completed within 3 months.

Same as government Lokpal.

A case may be transferred from one bench to another by the Chairperson if he feels that justice could not be met without the transfer.

He also has to give reasons for transfer in public domain within a week of the transfer.

Prosecution The Lokpal may constitute a prosecution wing. The court shall complete the trial within one year or may be extended to two years on reasons given in writing.

No sanction is required to fi le a case against a public servant.

Procedure for MPs other than ministers, and Group A offi cers: After investigation, if any per son is found guilty, the Lokpal may fi le a case in the Special Court and recommend disciplinary proceedings to the competent authority;

and provide a copy of the report to the public servant. The competent

The Lokpal shall have a prosecution wing (CBI’s prosecution wing to be under Lokpal).

After an investigation is completed, the Lokpal may either initiate prosecution against the public servant or may impose penalty or do both. The Lokpal can initiate prosecution in the Special Court formed Under the Prevention of Corruption Act 1988.

The Lokpal shall appoint retired judges or retired civil servants as judicial offi cers. Prosecution can be initiated against the Prime Minister, Ministers, MPs and judge of the Supreme Court or High

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authority has to take action within 30 days and inform the Lokpal within 6 months of initiating the disciplinary proceedings.

Procedure for PMs and ministers: If any person is found guilty, the Lokpal may fi le a case in the Special Court and send a copy of the report to the competent authority.

The PM or the Speaker/

Chairman shall lay the report on the table of the Parliament. The House shall examine it and send a report to the Lokpal on any action taken within 90 days.

Procedure for other public servants is not specifi ed.

Courts only with permission of a 7-member bench of the Lokpal.

Composition Chairperson and up to 8 members (at least 4 judicial members)

Chairperson and 10 members (at least 4 members with legal background). The Chairperson to have extensive knowledge of law.

Same as Government Bill

Qualifi cation Chairperson shall be a current or former Chief Justice of India (CJI) or judge of the Supreme Court.

Judicial members shall be current or former judges of Supreme Court the Supreme Court or Chief Justices of the HC.

Non judicial members shall be of impeccable integrity with at least 25 years of experience in anticorruption policy, public administration,

A judicial member should have held judicial offi ce for at least 10 years or been an advocate of the High Court or Supreme Court for at least 15 years.

All members should be of impeccable integrity with record of public service especially in the fi eld of corruption.

A person cannot be a member if he is not a citizen of India, has a case involving moral turpitude

Same as the Government Bill Adds that the Chairperson shall be or shall have been a CJI or judge of the Supreme Court or is otherwise qualifi ed to be a member of the Lokpal. Implies that Chairperson could be a nonjudicial person.

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Issues Lokpal Bill 2011 (Government Bill)

Draft Jan Lokpal Bill 2011 (Anna Hazare)

Amendments of NCPRI (Aruna Roy)

vigilance and fi nance Once appointed, he cannot be an MP, MLA or be connected with a political party, business or practice a profession.

A judicial member has to be either a CJ of the High Court or a judge of the Supreme Court.

against him by a court, below 45 years, was a government servant within the last 2 years.

Removal The Lokpal may be removed by an order of the President after an inquiry by the Supreme Court.

The members of the Lokpal shall be removed by the President on the recommendation of the Supreme Court made within 3 months.

The Lokpal may be removed by an order of the President after an inquiry by the

Supreme Court.

Jurisdiction All corruption cases under the Prevention of Corruption Act, 1988 (PCA).

It covers the PM after he has demitted the offi ce, MPs, ministers, ‘Group A’ offi cers, any ‘Group A’ offi cer in a company or body owned by the government, any offi cer of a society or trust that is fi nanced by the government or through public funds. Excludes, judiciary and any action of an MP in the Parliament or Committee.

Offences by a public servant under the Indian Penal Code and the PCA.

An act of corruption also includes any offence committed by an MP in respect of a speech or vote in the House; willfully giving or taking benefi t from a person and victimizing a whistleblower or witness.

It covers all public servants as defi ned in the Prevention of Corruption Act, 1988 (includes government employees, judges, MPs, ministers, and Prime Minister).

Only PCA offences (same as the Government Bill). On persons covered, adds that the PM should be included with certain safeguards: (a) the full bench of the Lokpal should refer the complaint to the CJI who shall refer it to the full bench of the Supreme Court. The Lokpal would take up the investigation based on the decision of the bench. (b) It excludes the PM in cases where he is not directly involved. (c) If the PM felt that any information would compromise national security, he would brief the CJI in confi dence and the CJI would decide whether the information should be disclosed.

Exclude any offi cer of a society or trust that is fi nanced through public funds.

Complaint against Lokpal staff

The Lokpal shall

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