Team Name : Team AP

Team Members : Sanya Goel, Kishlay Raj, Sparsh Nandanwar

Team Leader’s Contact Number : 7428511890

Answer 1

There are 6 basic types of managerial powers that have been widely practiced:

1. Legitimate/Bureaucratic power: a type of formal power which has been granted to the
manager by the peers to outline the manager's responsibility.

2. Reward power: it's the ability to confer or withhold rewards such as money, privileges,
promotion, or status.

3. Coercive power: this type of power depends entirely upon fear; it makes the personnel believe
that [s]he may be deprived of something if [s]he doesn't comply.

4. Expert power: this is basically the manager's influence over personnel based solely upon
superior knowledge, experience and expertise.

5. Referent power: shared interest, personnel look upto you with the desire of reaching to your
position someday. It's more of a hero worship thing.

6. Reciprocal power: this type of power is based on moral; deals with fulfilling people's request
and doing them a favour. The manager may get something in return.

In this case, if the allegations against Kocchar are assumed to be true, Kocchar had practised
Reciprocal power because reciprocal power literally means you're doing someone a favour and you
may get something in return.
Venugopal Dhoot, the chairman of Videocon Group, with the help of Deepak Kocchar (Chanda
Kocchar's husband) did get lots of favours by Chanda Kochhar and NuPower Renewables Pvt. Ltd. (a
company owned by Deepak Kochhar) had received INR 640 million from Videocon Industries
Ltd(VIL) and this was just the tip of the ice.

Answer 2
Dealings at the "Board" level might eventually attract a lot of troubles if somehow there's a conflict of
interest either an actual or potential one. Board of Directors(Board) might fall into conflicts arising
due to violation of broadly two kinds of duties at governance level: Duty of Loyalty and Duty of Care.

Board needs a firm commitment towards the duty of loyalty in order to ensure that the decisions are
being(or have been) taken in the best interests of the organisation above all. Whereas, duty of care,
too, needs such an attention, as it enables the Board to analyse the decision making process with
utmost care. Being on Board, one just can't(and shouldn't) throw a spaghetti on a wall and wait to see
what sticks behind, afterall, today's decisions are nothing but a groundwork for tomorrow's stock
prices.

The most feasible and appropriate solution to avoid such conflicts, in many situations, might be - a
Disclosure. As soon as, any Board member identifies a potential conflict of interest ahead of time,
he/she needs to disclose it in front of the Board, in order to safeguard the interests of the organisation
at large, otherwise, it might cost a hefty fortune to the organisation, sometimes, even till the mark of
dissolution.

Answer 3

Conflicts between power and leadership are at the heart of most corporate governance controversies in
Indian Corporations , whether they are about mergers and acquisitions, unjustifiable CEO pay, hiring
and firing or sanctioning a loan. Conflicts between power and leadership are inherent to widely held
companies where the CEO or an elite set of top managers make all the key business decisions.

Governance mechanisms such as independent directors on the Board, or a nomination and

remuneration committee are constituted to check and avoid such conflicts that might hamper the
functioning of the organisation.

In Chanda Kochhar’s case, Members of the ICICI Bank Board had denied that any irregularities
occurred. ICICI Bank was one of the consortium of banks that lent 40,000 crore to the Videocon
group, and the terms it offered were no different than those of other banks in the domain. No matter
the justifications in favour of Chanda Kochhar, there was certainly a conflict between leadership and
power that led her to take such a decision. She should have stayed away from the ordeal to avoid any
suspicion of nepotism.
But then, conflict between leadership and power crops up in almost every facet of our life. The only
realistic way to tackle it is to focus on adequate disclosures.