In the words of the Birla Committee, ‘Corporate Governance is the blood that fills the veins of transparent corporate disclosure and high quality accounting and the muscle that moves a viable and accessible financial reporting structure.’ This paper highlights two important stakeholders who are the core of Governance of any corporate organization—shareholders and government. The shareholders provide funds for the actual functioning, expansion and diversification of the organization through the purchase of its shares, debentures or securities and in exchange for this investment, expect some tangible and monetary return either in the form of dividends or interest or sometimes if the company is extremely successful, through the issue of bonus shares. The government regulates the working of corporate organizations through formulation of regulations which organizations need to follow both in letter and spirit. In this paper, the authors have attempted to study the shareholder and government-related practices of Wipro Ltd.—a leading Indian IT company. The case study is based on triangulation of data based on personal interviews with top executives of the company, responses to an executive perception survey and supplementary information available in the public domain. It was observed through this case that though Wipro Ltd. is predominantly a family-owned organization, it has endeavored to maintain transparency and accountability in its governance mechanisms as is typical of a professional organization.

Founded in 1945 as Western Indian Vegetable Products by M H Hasham Premji, Wipro commenced operations in 1946, and set up an oil mill and a hydrogenated cooking medium plant before going public. Over the years, Wipro diversified into several unrelated businesses on its own and through subsidiaries. These industries included soaps, wax, tin containers for packaging, crushing, etc. In 1966, Premji was succeeded by his son Azim. The first diversification happened in 1975 when Wipro set up an independent company to manufacture hydraulic cylinders (known today as Wipro Infrastructure Engineering). Wipro’s landmark foray into the world of information technology started in 1980 with an initial focus on R&D and computer manufacturing. Wipro’s entry into the IT business was helped by lack of competition from IBM, which was asked to leave India by the government in 1977, following a dispute over investment and intellectual property. With its name and brand established, in the early 1980s, Wipro began selling through a dealer network and began assembling products made by well-known companies such as Canon, Cisco Systems, Epson, Hewlett-Packard and Sun.

Thirty years later, Wipro Ltd. is a diversified company with dominant presence in IT, consumer care products, lighting and infrastructure engineering. As on September 30, 2009, Wipro had 840 active global clients in the IT business, of which 191 were Fortune 1000/Global 500 companies. The company is world No. 4 in IT services in terms of market capitalization. For the period of five years from 2005-06 to 2009-10, the company’s revenues had grown at a 29% Compounded Annual Growth Rate (CAGR). For the year 2009-10, the company’s revenues were 271.24 bn. While IT services contribute to 75% of the revenue, IT products contribute to 14% and non-IT business contributes to 12% of the revenue.

Wipro serves its global clients in the IT business by providing IT services, Business Process Outsourcing and Outsourced Research and Product Development services. In addition, in India, Wipro manufactures IT products and provides System Integration services for a wide spectrum of medium and large organizations from the private and public sectors, the government and a sizable retail segment.

Wipro Consumer Care and Lighting business, as the name suggests, provides personal care products, soaps, toiletries, infant care products and modular switch lights. Its Santoor brand is the third biggest soap brand in India. The company has a strong brand presence in a niche segment and has significant market share in select regions in India. It also has a strong presence in the markets for personal care products in south East Asia. It also provides institutional clients with lighting solutions and modular office furniture. This is the business with which Wipro began operations in 1945.

Wipro Infrastructure Engineering manufactures and markets hydraulic cylinders and truck tipping systems which are used in a variety of earth moving, material handling, mining and construction equipment. It also provides water treatment and reuse solutions to industries, communities and institutions. It also consults, engineers and executes clean energy and energyefficiency solutions around a breadth of technologies—from solar to wind to geothermal.

Wipro Ltd., the legal entity, is a company registered under the Indian Companies Act, 1956, with its shares listed in National Stock Exchange and Bombay Stock Exchange in India and ADRs in the NYSE, US. As on March 31, 2008, Wipro Ltd. had 77 subsidiaries of which 6 were Indian companies and the remaining 71 were registered outside India. Headquartered in Bangalore, India, Wipro has operations in over 35 countries.

Among the many landmark achievements to its credit are—it is world’s largest independent R&D services provider; world’s first IT services company to use Six Sigma in 1997; world’s first SEI CMM/CMMI Level 5 IT services company in 2001; the first to get the BS15000 certification for its Global Command Centre; its among the top 3 offshore BPO service providers in the world; pioneer in applying ‘Lean Manufacturing Techniques’ to IT services and a strategic partner to 5 of the top 10 most innovative companies in the world among many others.

Corporate Governance Journal, Corporate Governance Reforms, Financial Disclosures, Indian Companies, Financial Sector Reforms, Globalization, Information Asymmetries, Indian Corporate Morality, Market Mechanism, International Financial Reporting Standards, IFRS, Indian Accounting Standards, Economic Development, Financial Accounting Systems, Corporate Control Mechanisms.