‘Start-ups should draw their own redline to avoid issues of corporate governance’

Start-ups as well as large businesses should draw their own redline and stay within those boundaries to avoid issues of corporate governance, said Gautam Ahuja, Eleanora and George Landew professor of management at the SC Johnson Graduate School of Management, Cornell University. 

He was delivering the inaugural CK Prahalad Next Practice Oration organised by TVS Capital here on Thursday. The oration was in the memory of CK Prahalad, an internationally renowned management consultant, professor and the author of several best-selling management and corporate strategy books. Ahuja was speaking on the topic, ‘CK Prahalad lessons from an academic entrepreneur’. 

The Cornell professor said several companies in India and the US have had a mercurial rise with high valuations and market interests but soon fell from grace on issues of corporate governance. Corporate governance, Ahuja said, is simply nothing but another name for honesty. 

broke all norms

Sharing a lesson from CK Prahalad’s life, Ahuja said entrepreneurs are meant to break the rules while academics are trained to only follow the rules but CK Prahalad broke all those norms. 

He said while Prahalad wrote many ideas on management, he took the risk of publishing them in business journals instead of filing them as academic literature, which was the norm among the academic circle. 

Ahuja said another important lesson that entrepreneurs should learn from Prahalad is to be discreet in identifying your customer. “If you see everybody as your customer, it is very likely that you are not going to do any good for any of them,” Ahuja said, adding that entrepreneurs should be clear in identifying who is not their customer. 

In his inaugural address, Gopal Srinivasan, Chairman and Managing Director, TVS Capital Funds, said, in many ways, Prahalad can be called the founder of TVS Capital as the company was based on the vision and management principles of the late management guru. 

The inaugural CK Prahalad Next Practice Award was presented to Nithin Kamat, co-founder of online broking firm, Zerodha.