The fraud at Satyam: the role of independent directors

Check out T.T. Ram Mohan's posts on the fate of some 'independent' directors at Satyam, and on the need for reforms that would prohibit directors of a company from consulting for it.

Ram Mohan links to this Sandipan Deb column which comes down hard on the most credentialed director in Satyam's now-discredited board: Harvard's Krishna Palepu:

... Think of Krishna Palepu, the Harvard professor acclaimed as the world’s greatest expert in corporate governance. His official CV states that “in the area of corporate governance, Professor Palepu’s work focuses on how to make corporate boards more effective, and on improving corporate disclosure”. Among the executive programmes he teaches is “Audit Committees in a New Era of Governance”. “He also co-led Harvard’s Corporate Governance, Leadership, and Values initiative, launched in response to the recent wave of corporate scandals and governance failures.”

A friend of mine wrote to Palepu. “Evidently,” he wrote, “you are guiding US-based global corporations in such matters. However, in your ‘home’ country, you are helping organisations like Satyam steal shareholders money. My question is simple—does this make you a traitorous hypocrite, or merely a greedy criminal? I’m inclined to the latter, but as an eminent Harvard professor, perhaps you can guide me on the correct terminology? Look forward to your response.”

Guess what? Palepu has not replied. “Greedy criminal”, I would think.