Biz India Ethical Way Forward

Doing Business in India Hitherto

If you choose not to participate in

[corruption], you leave behind a fair
amount of business.

RATAN TATA

 Much has been written about the benefits of

doing business in India low input costs,
easy access to labour and a massive consumer
base.

Is that all what is

needed for a
business to prosper
in India??

 On a second thought, you shall realize that the ability of companies

to thrive in India also includes bending rules, greasing palms and

broadening ethical boundaries.

In a recent survey conducted by the United Nations Conference on

Trade and Development (UNCTAD), India replaced the U.S. as the
second-most important foreign direct investment (FDI) destination
for transnational corporations.

Yet even a small slice of that pie has been elusive for many
transnationals.
Goldman Sachs India admitted that growth to date has been slow,
as the companys priority has been to protect its reputation by
dealing only with clients with the highest ethical standards.
The German firm Enercon, the worlds fifth-largest wind turbine
manufacturer, was forced to walk away from its US$566 million
joint venture after being intimidated by authorities and failing to
find legal recourse to what it termed government-abetted theft.
Even Ratan Tata admitted that officials expectations of bribes were
the reason he did not establish a domestic airline.

Wipro Named as a 2014 World's Most Ethical Company by the Ethisphere

Institute for the Third Successive Year
Scores were generated in five key categories: ethics and compliance
program (25%), reputation, leadership and innovation (20%), governance
(10%), corporate citizenship and responsibility (25%) and culture of ethics
(20%).

What do you say of a vendor who dilly-dallies in taking back a defective

product, or refuses to refund for services not rendered, or a
pharmaceutical company that introduces a drug without fully complying
with guidelines of clinical trials? What are the implications of doing
business without business ethics? Is it only a cost to the customers at
the receiving end?

Maybe yes in the short run, but over a longer period, it hurts
businesses in an increasingly globalised commercial environment, where
customers across regions are connected through ever expanding social
media. Besides, during slowdown, unsatisfied customers dump unethical
businesses first and add to their miseries.

 Prediction

Observed Situation @ Big

Bazar during Internships

Huge profits and lack of

policies and framework
will incentivise unethical
practices
FDI most susceptible to
corruption and unethical
practices . Lobbying by
Wal-mart is a classical
example
The State Govts
Discretionary power may
add fuel to fire

Pulling Crowd by
false promises ( Price
, Limited Stock ,
Quality)

For Sustainibility
If a company helps society through their business as a main goal, then they will reap
business.
Companies that do not seek to maximize the stakeholder value chain, from populous
masses to shareholders and leadership, will find a lack of competitiveness in the
evergrowing dichotomy between the emerging and developed world.
Without change at the organizational level, the global competitiveness of India will not
be able to sustain continued growth.

What to do _ Org level

Ethics officer
Training and Sessions: Making employees
understand the Legal and societal implications
Open door policy to discuss issues
Zero tolerance for image building
Follow the leader
Learning through realisation

What To Do _ Employee Level

Ethicality test at joining
Ethical Reference and background check
before joining
Ethical behaviour exhibited should be asked.

The Way Forward

Ethical Practices Clause in partnerships and
contracts to disassociate and protect self image.
Ethics for All Ethicall : A Set of guidelines
governing standard acceptable behaviour in a
given situation.
Education though imperative, but is not the sole
solution.
People around you, not limited to your social
circle, and tolerance to such questionable
behavior will shape the future of ethics.

Suggestions
1. Realign business priorities with corporate stakeholder responsibility.
2. Define a value added role for all stakeholders, local and global.
3. Formulate bold, long-term targets and create processes that drive ethical
decision making and stakeholder maximization.
4. Establish credibility through a refined and enforced code of ethics.
5. Exploit ethical differentiation and attack the global market with the
leverage of local strengths.
6. A system of online filing of complaints will improve complaint
registration and empower unorganized customers against unethical
business practices.