SINGAPORE - E-commerce platform Zilingo has fired its chief executive Ankiti Bose, also the co-founder of the firm, following an investigation into complaints of serious financial irregularities.
In a statement on Friday (May 20), the Singapore-based firm said it decided to terminate Ms Bose’s employment “with cause” and that it reserves the right to pursue appropriate legal action.
The start-up, which counts Sequoia Capital India, Singapore state investor Temasek, and the Economic Development Board’s investment arm EDBI among its investors, had earlier suspended Ms Bose on March 31.
In its statement, Zilingo said that Ms Bose brought “certain harassment-related issues pertaining to past time periods” to the attention of the firm’s board on April 11.
These issues did not include any harassment complaints against investors or their nominees, it added, noting that a top consulting firm had been engaged to look into the claims brought forth.
“The investigation has concluded that the company took appropriate action and followed due process to address these complaints that were brought to their notice, contrary to media reports that have suggested that the suspension and investigation into Ankiti Bose were aimed at suppressing the said harassment claims,” Zilingo said.
Ms Bose, in a statement posted on her LinkedIn account and other social media profiles on Friday evening, said that she had been informed that she was terminated on grounds of “insubordination”.
This was after she had been suspended based on an anonymous whistle-blower complaint, she said.
“I was suspended on the basis that the company had instructed investigators to investigate the complaint. I have neither seen the reports and not been given sufficient time to produce any documents requested by them,” she said.
She added that she has been receiving “a constant barrage of online threats” to her life and her family.
Ms Bose said she will be speaking on record shortly with more details about the conflicts of interest in the manner the process was run and other matters which she said are being used to defame her.
In its statement, Zilingo said: “The company is deeply pained and disappointed to see the manner in which the board, investors and employees have been constantly attacked through ostensibly leaked and fake information, along with what unfortunately appears to be paid and defamatory social media campaigns throughout the investigation period.”
This has cause irreparable damage to the start-up, board, staff and backers, it added.
The company noted that following the recall of loans by debt holders, an independent financial adviser was appointed and is in the midst of assessing options for the business.
More information will be provided in due course, it said.
Ms Bose had earlier been suspended from her duties while the start-up’s accounting practices were investigated. Regulatory checks show that Zilingo’s last financial statement was filed in 2019.
Ms Bose, who co-founded the company with Mr Dhruv Kapoor in 2015, has disputed claims of wrongdoing.
Commenting on corporate governance issues that start-ups face, NUS Business School’s Professor Mak Yuen Teen noted that such issues are not uncommon. Start-ups here and elsewhere have faced the likes of toxic culture, product fraud, financial irregularities and conflict of interest, he noted.
“Founders are by their nature entrepreneurial and risk takers, and may push the boundaries. They are also often charismatic and able to convince people to buy into their vision,” he said.
Prof Mak added that with problems emerging in start-ups, investors may be more careful about due diligence before investing and may demand better corporate governance, and start-ups that are not prepared for these may find it harder to attract investors.
Start-ups need to ensure that they have at least the basic corporate governance in place, he said.
This includes measures such as having accounts audited by a respectable audit firm on a timely basis, having proper internal controls for key business operations, having an internal audit of the key risk areas, and having a properly constituted board with some independent members.
Singapore Institute of Directors vice-chairman Adrian Chan said that while he does not believe confidence in the boards or founders of start-ups has necessarily been shaken by Zilingo’s situation, there are lessons to be learnt from this case and the issues that have surfaced.
Mr Chan, who also serves on the Enterprise Board of the SMU Institute of Innovation and Entrepreneurship, noted that start-up boards and founders should be trained and equipped with the necessary governance skills and knowledge to run their businesses effectively.
“Paying heed to corporate governance makes good business sense and should not be viewed as a burden. And if boards fail to recognise this early on, they may find themselves paying a higher price later on,” he said.