TCS hit by bribes-for-jobs scandal: Four executives fired
Tata Consultancy Services (TCS), one of India's biggest IT companies, has been rocked by a bribes-for-jobs scandal. The matter was brought to light after a whistleblower alleged that a few senior executives of the company responsible for hiring took bribes from staffing firms. According to Mint, TCS has taken action against the executives and staffing firms involved after conducting an investigation.
Why does this story matter?
Bribes-for-jobs scandals are not uncommon in India, but they usually happen in the government sector. That doesn't mean non-government firms are averse to such impropriety. However, they are typically limited to small companies with inadequate corporate governance. Therefore, a recruitment scandal at a company like TCS is a massive surprise. It shows a lack of oversight on the firm's part.
Whistleblower alleged head of recruitment accepted bribes from staffing firms
A complaint by the whistleblower to the CEO and COO of TCS uncovered the hiring scandal. The complainant alleged that ES Chakravarthy, TCS's resource management group's (RMG) global head, accepted bribes from staffing firms for years. RMG is the company's recruitment division. Chakravarthy, who has been at the firm since 1997, holds the rank of vice president.
TCS blacklisted 3 staffing firms
Following the complaint, TCS set up a panel of three executives to investigate the allegations. The team included Ajit Menon, the company's chief information security officer. After a probe that lasted for weeks, the firm sent Chakravarthy on leave, fired four RMG executives, and blacklisted three staffing firms. The names of the executives and staffing firms involved haven't been disclosed.
People involved earned at least Rs. 100 crore in commission
Per Mint, TCS is yet to ascertain the scale of the scandal. The company, however, thinks the people involved earned at least Rs. 100 crore through commissions. It is not surprising, considering what the RMG division did. The 3,000-strong division places about 1,400 engineers on projects daily. TCS's total workforce stood at 614,795 as of March 31, 2023.
The scandal has shocked TCS's senior leadership
The scandal has shocked TCS. "The entire senior leadership is shocked," a company executive told Mint. "This makes you question if there were enough guardrails, and how could such a thing happen," they added. However, what's worrying is that the firm has no idea how long it's been going on. TCS has hired over 300,000 people in the last three years.
