Economic Growth - Values and Ethics as drivers

Corporate Governance has become a highly discussed issue of late largely because of high profile corporate scandals, bringing into the spotlight executive greed and malpractices. It has caught the attention of lawmakers and laymen alike. This is because the manner in which corporations are run sooner or later affect a large number of people and even whole economies. Corporate Governance is all about systems, processes, ethics and values.

Simply put Governance is the nuts and bolts of how a company or country is run. Thus Corporate Governance translates into good business as a well-oiled machine always delivers better results.

A very apt and eminent group of people gathered to discuss Corporate Governance and suggested some concrete steps with examples to improve the way corporations are run.

Excerpts:

Mr. Seshasayee, President CII and MD Ashok Leyland Ltd

How do we measure values? This was the question he tried to answer and stressed that companies needed to have a bench mark in terms of values and business ethics, and place a record conforming to values and ethics. He quoted Ratan Tata as saying that "In this process if we have actually lost some growth, so be it."

What is right and what is wrong is not easy to determine. One of the best ways to resolve this is to just follow your intuition and if the decision you take allows you to have a good night's rest then you can be at peace that you have chosen the right path.

Mr. Nandan M Nilekani, CEO & MD Infosys Technologies Ltd.

India is on the cusp of change and a diverse set of things have come together to create great opportunities for businesses here. But we have found that whenever we have opened up the competition and the public sector and private sector are allowed to compete there is better performance and accountability.

Ethics is not CSR. It is a very strategic issue of how a company responds to the current environment.. It is the challenge where the company looks beyond themselves and ensure not only their survival but also that of the society that they belong.

First companies have to redefine success. There has to be a larger focus, not just profit but a lasting impact on society and environment. A company gains authority by consistency and quality of their behavior. This can be achieved by holding on to a clear set of values and having mechanisms to deal with challenging practical situations.

Infosys has tried to be a role model and inspire other companies. We have shown that practicing these values are not incompatible to growth. It is in fact a source of competitive advantage. Also working together and with a coalition off companies takes us forward. I propose we raise the bar on values and ethics in business.

Dr. Jamshed J Irani, Past President CII & Director Tata Sons Ltd

"No success in material terms is worth it if it is achieved by unfair means." - JRD Tata

It is well known that the Tatas are philanthropic and CSR is of utmost importance. But for us to be able to do all that, one has to create wealth. So we have to make a profit. The differentiators come later when you decide what you want to do with that profit. We have always given back to the people hopefully magnified many times over.

In the case of the Tatas, our core values are

1.   Trust

2.   Credibility

3.   Ethical business practices

4.   Respect

5.   Excellence in whatever we do

6.   Fairness to all

We have been following these same values for the past almost 130 yrs. It has been the bedrock and a beacon of light in stormy seas for our company. And talking of corruption, I can tell you there are only 4 ways to leave the Tatas

-the good god calls you, you reach 60 yrs and retire, you resign, OR you do something corrupt.

Management schools have an important role to play because they are yet to introduce Ethics as a subject. We have already started this process at  XLRI Jamshedpur and also organize an annual JRD Tata memorial lecture on ethics.

The investor's role in the ethics of a corporation is to demand ethical practices from the company in which they invest. The customer's role would be to make it a point to buy from corporations which are ethical. Employees can make an effort to make sure they join a corporation which follows ethical practices.

TO SUM UP:

1.  Play Business according to the rules even if your competitor does not. The goal post is fixed so to say.

2. Ethics in business is important because it pays. In the long run it always pays even monetarily

3. Long term benefit for the country is greater than short term benefit for the corporation

4. Do your bit.

5. Corporate governance cannot be mandated. It is easy to follow in spirit than in form.

6. Business schools need to prepare young and upcoming managers in business ethics

7. The end never justifies the means.

Swami Sukhabodhananda, Founder Chairman, Prasanna Trust

There are two levels of creativity, the outer and the inner. You will be a winner in the outer world when you achieve growth and a winner in the inner world when you feel a sense of satisfaction. Getting what you want is success and liking what you get is satisfaction. When these two elements are in harmony there is bliss. If there is no inner fullness then inspite of external success you will not find happiness.

All this is possible by following good values and truth. In the Indian context there are three states of mind The ananda lahiri where being truthful is simple and instead of being lost in becoming happy, just BE HAPPY.

The next prema lahiri is to ‘Love what you do and do what you love'. It should be a liked value and not just a spoken value. It is only when the present is unhappy that we end up doing immoral activities. That is for example if one thought that if I had a better job with a better salary I would then be happy; it would lead to doing something wrong just to get that thing.

The last soundarya lahiri is to learn to see beauty in ‘what is' and not ‘what should be'; if your boss or wife is shouting at you appreciate the tone, usage of words and the way their mouth moves and be Happy! Learn to see the elegance in imperfection.

I would like to share a list of do-ables to be happy.

1. Learn to see a possibility

2. Live that possibility

3. What is preventing us from living that possibility is the old mindset.

4. If you don't change it, then society will continue to support the old mindset.

5. Create a new society to support your new mindset.

6. This will lead to a enlightened society that will be mutually nourishing.

Lastly remember that in this rat race even if you win you are still a rat! So learn to say WOW to life and BE HAPPY.

These were excerpts from the CII meet on corporate Governance as part of their Annual Regional Meeting 2007.

Issue BG74 May07