An Internal Pernod Ricard Investigation Finds Top Executives of Its Indian Business Violated the Law by Colluding with Retailers
An internal investigation led by Indian law firm Shardul Amarchand Mangaldas, hired by Pernod Ricard to probe allegations of wrongdoing by top executives of its Indian business, has found that these executives acted in violation of Delhi’s Excise Policy, which prohibited manufacturers from investing in retail. The report, a copy of which was seen by Reuters, says that the executives, including the then-chief operating officer of Pernod’s Indian operations, Rajesh Mishra, were involved in a larger conspiracy with other industry players.
The report also states that Mishra made a “factually inaccurate” statement to Indian federal agents during questioning, suggesting that he and other executives were involved in a larger conspiracy to influence the formulation of the 2021 Delhi liquor policy, which allowed private retailers to operate liquor shops.
The 66-page report highlights that the three executives, including Mishra, had conversations that suggested that corporate guarantees were a means to control the market share through retail control. The report also concluded that there are implications for Pernod in legal proceedings and recommended that Mishra be sacked or asked to resign.
Pernod Ricard has denied any wrongdoing by its executives, but the Enforcement Directorate, India’s financial crimes agency, had accused the company of money laundering by providing corporate guarantees to retailers in exchange for stocking more Pernod brands. The total amount of guarantees was $24 million.
The report’s findings are significant as Pernod Ricard is contesting restrictions on the sale of its brands in New Delhi, a key market in India. The company, which is the largest manufacturer of spirits in the country, has been facing regulatory challenges in India, including a probe into its dealings with retailers and a dispute with the government over a tax demand for allegedly undervalued imports. India is a significant market for Pernod, accounting for 16% of the country’s spirits market in 2023, according to Euromonitor.