The board of directors sacked SKS Microfinance MD & CEO Suresh Gurumani after a few months of an IPO of Rs 1650 crores. The reason could be that SKS Microfinance founder and executive chairman MrVikram Akula had interpersonal issues with Suresh Gurumani. Previously, some senior management had left the organization on the same grounds. According to information, the board of directors all voted in favor of termination of Suresh Gurumani. There were no performance or business ethics issues to implicate Suresh Gurumani .
With repeated actions of the executive chairman and board to terminate senior management on interpersonal issues, there appears marked disrespect for corporate governance. Should owners of listed companies, where public money is involved, be allowed to settle personal scores in this manner? Read the article from Times of India below to assess for yourself.
“HYDERABAD: Even as the reasons for the unceremonious sacking of Hyderabad-based SKS Microfinance’s MD and CEO Suresh Gurumani continue to be shrouded in mystery , it now emerges that this is not the first time that India’s largest MFI has seen a change of guard in such an abrupt fashion.
Industry insiders, who have witnessed the rapid rise of SKS Microfinance from an Andhra Pradesh-based MFI to one of the largest MFIs in the world in less than a decade , point out how power tussles and hasty departures at the top have been the norm than exception in the company . While the manner in which Gurumani, who joined the company in December 2008, was given the boot within months of a successful IPO of Rs 1,650 crore has already sent alarm bells ringing over the flouting of corporate governance norms, whispers have been growing louder about personality clashes and differences of opinion with SKS Microfinance founder and executive chairman Vikram Akula precipitating the crisis . While, TOI’s attempts to reach Akula were unsuccessful , news agencies on Tuesday quoted him as admitting that Gurumani was fired because of “interpersonal issues with senior management” . But industry sources point out that on more than one occasion people at the helm of SKS like Praseeda Kunam and Raghunatha Reddy had to leave within days of Akula’s return to an active role in the company’s affairs.”
Read more at SKS faced power tussles in past too at Times of India site.