TCS Takes Strong Action: Bans Employees and Business Associates in Bribery Investigation
Tata Consultancy Services (TCS) has announced the banning of six employees and six business associate (BA) firms or staffing firms involved in a recruitment bribe case. In a statement addressing reports and shareholder queries during the company’s annual general meeting (AGM) on June 29, TCS Chairman N Chandrasekaran provided details of the investigation and outlined the steps being taken. This marks the first public acknowledgment from a senior executive about the case after a week of discussions and speculations. Chandrasekaran revealed that the company has identified six employees who engaged in unethical conduct and favored certain firms. These employees, along with the associated BA companies, have been banned, while investigations into three more employees are ongoing. TCS is also conducting a comprehensive review of its BA supply management process to identify and address any weaknesses. Chandrasekaran emphasised that ethical conduct and integrity are paramount for Tata Group companies, surpassing financial performance, and strict actions will be taken against any violations.
Chandrasekaran explained that during the overall deployment of resources, approximately 2-3 percent of them consist of business associates (BAs) or contractors. The complaint revolved around specific individuals within the company collaborating with certain BA firms to favor their recruitment.
He further stated that TCS collaborates with a large number of BA firms, and there is a rigorous process in place to qualify and recruit them. Globally, there are slightly over 1,000 such firms working with TCS, as resources are required in 55 countries. Each firm conducts business based on its skill availability.
TCS has reportedly blacklisted partnering staffing firms and terminated employees from its Resource Management Group (RMG) division. Allegations suggest that the firms charged commissions for preferential treatment and business from TCS. However, TCS denied these claims, stating that the RMG division is not involved in recruitment activities. The company conducted an internal investigation and found a breach of the company’s Code of Conduct by certain employees and vendors. No key managerial personnel were implicated, and TCS stated that there is no fraud or financial impact involved.
