Valery Legasov. The chief of a commission investigating the Chernobyl nuclear disaster. Before committing suicide, he records his words in audiotapes. With a cup of tea, an ashtray and a Soviet-era cassette recorder, he says:
“What is the cost of lies?”
“It’s not that we will mistake them for the truth. The real danger is that, if we hear enough lies, then we no longer recognize the truth at all.”
This is how the 1st episode of HBO mini-series, Chernobyl, kicks off.
What is the cost of lies? A question that turns out to be the first as well as the last line of the series. Well, the show reveals that the horrifying results of the disaster are the accumulation of lies. Especially from those who are in charge.
When the core of the nuclear reactor explodes, chief engineer Dyatlov doesn’t acknowledge it. When the members of The Pripyat Executive Committee gather, managers Fomin and Bryukhanov mislead them about the deadly circumstances. In a bipolar world, when the USSR doesn’t want to attract the World’s attention towards Chernobyl, it lies.
Lies. Lies. Lies. And the cost?
The Cost of Lies is the whole area that has become inhabitable for the next 20,000 years. The Cost of Lies is the lives of thousands of men and women who have died of radiation sickness. The Cost of Lies is handling a nuclear disaster that happens on Earth for the very first time.
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Now, let me talk about its relevance in the Indian business context.
During our Orkut days, Satyam Computers used to be a poster boy of the Indian IT industry. As a best-governed company, it won the Golden Peacock Award in 2007. The same year, its founder Mr. Ramalingam Raju bagged Ernst and Young Entrepreneur of the Year. With a clientele of high profile customers, it was India’s 4th largest company.
But who knew that beneath Satyam’s stature, rested layers of falsehoods and lies.
Raju, over a period of time, had fabricated his own brainchild’s financials. What seemed to be actual was actually hyped up. And in lieu of these bogus financial numbers, Satyam shares demanded higher premiums in the stock market.
When Raju admitted to his lies, the whole nation was stunned. An artificial operating profit of Rs.588 Cr. A non-existent accrued interest payment of Rs.376 Cr. A false cash balance of Rs.5000 Cr. Firm’s fixed deposits of Rs.33 million in 1999 grew to Rs.33 billion in 2009. The only caveat: it was all fake.
Phew! Not even a single regulator could smell the rat; let alone SEBI, IT officials, or NASSCOM.
Image: Fabricated BS of Satyam Computers | Source: Research Gate
The cost of lies? Share price witnessed a single-day fall of 76% which resulted in a massive erosion of shareholders’ capital. The secured jobs of lakhs of its employees suddenly jumped on thin ice. Imprisonment for an entrepreneur who falsified the glory of his business acumen.
On top of that, loss of credibility!
Image: Share Price Journey of Satyam Computers | Source: Placetaken (Blogspot)
Same goes for the German automaker, Volkswagen.
It is World’s 7th largest company by revenue. In 2018 alone, VW sold more than 62 lakh models across the globe. Internationally, VW cars are symbols of peace and love. Beetle enjoys worldwide loyalty from its fans. The driving style of Golf GTI has received praise over the years.
Despite all this, in 2017, the US Security and Exchange Commission sued VW with billions of dollars in fines and penalties. The group was charged for lying about its vehicle quality to the investors. And issued its bonds at an inflated price. In return, it reaped Millions.
Deliberately, it programmed its diesel engines to initiate emission controls only during the laboratory tests. As a result, the cars released NOx as per the US standards. Whereas, while driving in the real world, it exceeded the legal limits by 40 times. Forty times!
The cost of lies? 11 million cars were found to be faulty globally. Shareholders and other investors lost billions. Market value plunged by $40 Billion. $18 Billion were paid to deal with the damages.
And the extent to which the whole scandal polluted the environment? Huge.
Image: Share Price Chart of Volkswagen | Source: Business Insider
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The truth is: we all lie. About our relationships. Office leaves. Salary hikes. And whatnot. Sometimes, the associated costs are huge. The other times, small. Sometimes, we win. Sometimes, lose. But no one knows what he/she is going to get in the end.
The matter of the fact is that lying about things has become a survival kit. History proves that.
Long before the Bhopal Gas Tragedy happened, Union Carbide survived by lying about Methyl Isocyanate gas volumes. Long before the Maggi ban happened, it survived by lying about MSG and Lead levels in its product. Long before the I Monetary Advisory scam happened, its kingpin Mansoor Khan survived by lying about high assured returns.
And when such lies are discovered, the end results turn out to be disastrous. The likes of Chernobyl, VW Scandal and Union Carbide are the constant reminders that lies do have a cost.
In the end, I would like to ask: What is the cost of lies?
Related Reading: When Left Untouched
PS: The cover image has been taken from National Geographic
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