Did you bring your ethics to work today?
23 May 2013 7:36 PM GMT
Only a few days ago, an ex-employee of Ranbaxy blew the whistle on the company’s malpractices regarding the composition of its pharma products, and the data made available to the US Food & Drug Administration (FDA). The laudable act earned him the appreciation of the US government, as also a hefty amount for his honesty.
The gentleman had served for years in the US, and was familiar with the manner in which things worked there. Honesty is held in high esteem in the West, and absolutely mandatory from firms operating there.
This brings us to question the ethics of Indian multinationals, and the values that guide them.
Over the past few years, India has led all other Asian emerging markets in terms of growth of private inflows from equity and debt issued and loans raised overseas by domestic companies.
Taking overseas borrowings and equity issues together, a total of $16 billion was raised in fiscal 2005-2006, a hefty 75 per cent increase over 2004-2005. According to reports by the Reserve Bank of India (RBI), India Inc raised over $2.06 billion from overseas markets in April 2011 through external commercial borrowings (ECBs) and foreign currency convertible bonds (FCCBs), with nearly 55 companies raising over $1.54 billion through the automatic route (without RBI approval) while another $520 million being raised through the approval route.
To refurbish the old and build the new, Indian companies have eschewed traditional methods of raising money from corporate profits and loans from financial institutions and banks, taking advantage of the eased government policies regarding external borrowings. Understandably, this has also seen more and more global offices being set up by Indian conglomerates worldwide. At the national level, foreign direct investments (FDI) facilitated the entry of foreign investors in telecom, roads, ports, airports, insurance and other major sectors. This saw the BPO, IT, ITES, retail and insurance sectors make great strides. The Indian economy is projected by analysts to be about 60 per cent the size of the US economy by 2025. According to analysts, India is likely to be a larger growth driver than the six largest countries in the EU by 2035, though its impact will be a little over half that of the US.
These projections are based on the growing Indian share in world merchandise exporters. For instance, India’s exports grew by 22.5 per cent in August 2010 to $16 billion, with commodities like cotton yarn, gems and jewellery, iron ore, engineering, petroleum, oil and lubricants doing remarkably well. India is already the fourth largest economy in terms of purchasing power parity, and expected to overtake Japan within the next 10 years.
While a lot is said about India’s potential to become an economic superpower on the strength of its demographic strength, it is high time that we question the very basis of such beliefs. Analysts build on India’s advantage of a young working population to man its manufacturing and services sectors. But do we have the skilled manpower to match?
A country can harness the strength of its demographic advantage provided it makes the right investment in education and health. However, until the recent past, the government saw no logic in upgrading its schools or college syllabi. Consequently, students leave their educational institutions ill-equipped with vocational skills.
The state of government hospitals is pathetic, and barring a few urban centres, essential medical services are out of bounds for most. In spite of an enviable network of industrial training institutes all over India, very little information is available to those interested in undergoing vocational training after secondary education to secure jobs in manufacturing facilities or embark as small entrepreneurs. To make matters worse, archaic labour laws result in managements getting away with hiring labour through third parties, and paying wages far lower than what is permissible.
Consumer awareness has grown, and many companies have had to gear up their services to hold on to existing markets. But ethical standards are abysmal. Consumer products are forgotten of once sold, and consumers are easily taken for a ride. Corporate Social Responsibility (CSR) is hardly understood or believed in here. In the West, a corporate entity needs to be socially responsible to justify its existence by working for the community it is a part of. It needs to earn the general goodwill of the community or neighbourhood where it is operating, by improving upon and enhancing the quality of services the community has access to. In India, CSR is often used as a cover-up for the wrongdoing companies are upto when doing business. Even foreign multinational companies like Coca Cola and Vedanta have thought nothing in subverting the interests of the local communities here, coming in for strong criticism. Although the judiciary has turned pro-active on environmental matters now, the loss of livelihood is being used by some senior journalists in the media to justify their pleas for mining to continue unchecked. India has been particularly lucky in building up an upwardly mobile force of women professionals across all sectors. Yet, notwithstanding the fact that the Supreme Court of India had formulated the Visakha Guidelines to prevent sexual harassment at the workplace as far back as 1997, women continue to be sexually harassed, and hounded if they complain at the workplace.
The Sexual Harassment at Workplace (Prohibition, Prevention and Redressal) Act has just been passed by the government. But instances abound of highly-educated lady professionals working in multinational corporations getting terminated at their jobs the moment a complaint is made against a superior. The situation is no better in the print or broadcast media, which proves anything but an upholder of free speech in our democracy. Once complaints get to court, they drag on for years, leaving complainants frustrated and beaten by an unfeeling system.
Corruption and nepotism has made India a functioning anarchy where all wrongdoing is tolerated. But if India wants to rise up as a global power, it needs to swear by the principles of a welfare state that its Constitution had aimed it to be. Only then will India reap the fullest from its demographic advantage.
The gentleman had served for years in the US, and was familiar with the manner in which things worked there. Honesty is held in high esteem in the West, and absolutely mandatory from firms operating there.
This brings us to question the ethics of Indian multinationals, and the values that guide them.
Over the past few years, India has led all other Asian emerging markets in terms of growth of private inflows from equity and debt issued and loans raised overseas by domestic companies.
Taking overseas borrowings and equity issues together, a total of $16 billion was raised in fiscal 2005-2006, a hefty 75 per cent increase over 2004-2005. According to reports by the Reserve Bank of India (RBI), India Inc raised over $2.06 billion from overseas markets in April 2011 through external commercial borrowings (ECBs) and foreign currency convertible bonds (FCCBs), with nearly 55 companies raising over $1.54 billion through the automatic route (without RBI approval) while another $520 million being raised through the approval route.
To refurbish the old and build the new, Indian companies have eschewed traditional methods of raising money from corporate profits and loans from financial institutions and banks, taking advantage of the eased government policies regarding external borrowings. Understandably, this has also seen more and more global offices being set up by Indian conglomerates worldwide. At the national level, foreign direct investments (FDI) facilitated the entry of foreign investors in telecom, roads, ports, airports, insurance and other major sectors. This saw the BPO, IT, ITES, retail and insurance sectors make great strides. The Indian economy is projected by analysts to be about 60 per cent the size of the US economy by 2025. According to analysts, India is likely to be a larger growth driver than the six largest countries in the EU by 2035, though its impact will be a little over half that of the US.
These projections are based on the growing Indian share in world merchandise exporters. For instance, India’s exports grew by 22.5 per cent in August 2010 to $16 billion, with commodities like cotton yarn, gems and jewellery, iron ore, engineering, petroleum, oil and lubricants doing remarkably well. India is already the fourth largest economy in terms of purchasing power parity, and expected to overtake Japan within the next 10 years.
While a lot is said about India’s potential to become an economic superpower on the strength of its demographic strength, it is high time that we question the very basis of such beliefs. Analysts build on India’s advantage of a young working population to man its manufacturing and services sectors. But do we have the skilled manpower to match?
A country can harness the strength of its demographic advantage provided it makes the right investment in education and health. However, until the recent past, the government saw no logic in upgrading its schools or college syllabi. Consequently, students leave their educational institutions ill-equipped with vocational skills.
The state of government hospitals is pathetic, and barring a few urban centres, essential medical services are out of bounds for most. In spite of an enviable network of industrial training institutes all over India, very little information is available to those interested in undergoing vocational training after secondary education to secure jobs in manufacturing facilities or embark as small entrepreneurs. To make matters worse, archaic labour laws result in managements getting away with hiring labour through third parties, and paying wages far lower than what is permissible.
Consumer awareness has grown, and many companies have had to gear up their services to hold on to existing markets. But ethical standards are abysmal. Consumer products are forgotten of once sold, and consumers are easily taken for a ride. Corporate Social Responsibility (CSR) is hardly understood or believed in here. In the West, a corporate entity needs to be socially responsible to justify its existence by working for the community it is a part of. It needs to earn the general goodwill of the community or neighbourhood where it is operating, by improving upon and enhancing the quality of services the community has access to. In India, CSR is often used as a cover-up for the wrongdoing companies are upto when doing business. Even foreign multinational companies like Coca Cola and Vedanta have thought nothing in subverting the interests of the local communities here, coming in for strong criticism. Although the judiciary has turned pro-active on environmental matters now, the loss of livelihood is being used by some senior journalists in the media to justify their pleas for mining to continue unchecked. India has been particularly lucky in building up an upwardly mobile force of women professionals across all sectors. Yet, notwithstanding the fact that the Supreme Court of India had formulated the Visakha Guidelines to prevent sexual harassment at the workplace as far back as 1997, women continue to be sexually harassed, and hounded if they complain at the workplace.
The Sexual Harassment at Workplace (Prohibition, Prevention and Redressal) Act has just been passed by the government. But instances abound of highly-educated lady professionals working in multinational corporations getting terminated at their jobs the moment a complaint is made against a superior. The situation is no better in the print or broadcast media, which proves anything but an upholder of free speech in our democracy. Once complaints get to court, they drag on for years, leaving complainants frustrated and beaten by an unfeeling system.
Corruption and nepotism has made India a functioning anarchy where all wrongdoing is tolerated. But if India wants to rise up as a global power, it needs to swear by the principles of a welfare state that its Constitution had aimed it to be. Only then will India reap the fullest from its demographic advantage.
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