IL&FS: Never too big to fail

In this guest column Sandeep Hasurkar weaves extracts from his just published book on ILFS ‘Never too big to fail,’ with lessons the collapse holds for boardrooms.

The dramatic failure of Infrastructure Leasing & Financial Services Ltd. (IL&FS), the infrastructure to financial services behemoth, in September 2018 was as unexpected as it was seismic.

Its sudden collapse triggered shock waves that ripped through financial markets and the economy, throwing the NBFC/shadow banking sector into crisis and significantly slowing down growth even well before the current pandemic.

As among the largest bankruptcies in India to date – at nearly Rs ten trillion – the failure of IL&FS raised several questions regarding the roles of multiple stakeholders. It’s management, auditors, credit rating agencies, shareholders, lenders, regulators and the government. But above all, after the management, were questions regarding the role played by its board of directors.

Read this guest column and extracts from the book here