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TATA GROUP – POSTER BOY FOR ETHICAL BUSINESS

Updated: Oct 16



"QUOTE

 

Corporate Governance has become the new corporate jargon like shareholder value.  Corporate governance is really a state of mind. It embodies in the feelings and traditions of the Tata Group. JRD Tata’s name has been mentioned several times today and the group owes a great deal of this tradition to him. He often referred to the manager’s role as one of trusteeship. …Corporate governance is today, one of the attributes of a good corporate citizen. It is part of the management framework, but it does not replace the tradition ingrained in your bones.

 

UNQUOTE”

 

These words are from Shri Ratan Tata, on receiving the National Award for Excellence in Corporate Governance for the year 2000 from Mid-Day in March 2001. This is not a para, it’s a full book. A bit of analysis:

 

  1. Corporate Governance (CG) is a state of mind – CG is not a result. It has to be interwoven into the ethos of the company.

It embodies the feelings and traditions of the Tata Group – Jamsetji Tata laid down the philosophy of the Group “In a free enterprise, the community is not just another stakeholder, but is, in fact, the very purpose of its existence." The fact that Tata Group exists for 150+ years now is the biggest proof that this philosophy is solid and tenable. The fact that over the long term, if there is a Indian Group which has shown sustainable performance, it is the Tata Group. 

 

  1. Manager’s role is one of trusteeship - the owners and managers of industry/business are to consider their wealth and assets as if they are custodians for the society  and not as their personal property. They are to manage and handle all these assets only as trustees. That is why I would like to call all these Tata chairs as Rajarshis. A combination of determination, resolve yet being unattached to wealth (they call themselves as custodians of wealth not owners.

 

  1. CG is part of management framework, but it does not replace the tradition ingrained in your bones – How do we ingrain values in our bones, in our legacy, in the length and breadth of what we do. I think this is not taught in most homes, most schools and most institutions today. Values are permeated only when then the top of the structure lives the values, only when the top is value driven. Tata Group is an exemplary example of values being driven by the top.

 

As Shri JRD Tata summed it up in one of his letters, “Unfortunately courtesy, friendliness and personal modesty seem to have suffered in the aggressive and competitive world in which we live”. I think the pressure of race to be number 1, the fixation on results, the shorter route to gratification, the loss of consciousness in capitalism, the sheer stupidity to take as granted what cosmic forces provide are for free – all of this come together for situations resulting in loss of governance – whether as self or corporate or institutional. 

 

It's late but never too late – lets choose between GREED & GOVERNANCE – between प्रेय पथ & श्रेय पथ, between what I like & what is right.  

 

 

Courtesy: A book of Tata quotes

 

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