Emerging Market Leader Takes Social Responsibility to a New Level

08 Jul 2007|Darrel Rhea

A startlingly different approach to business ethics and management is coming from an emerging market. How might the success of one man and his organization shift the standards of practice for global business?

Recently I attended a breakfast with Mr. R. (Gopal) Gopalakrishnan, Executive Director of Tata Sons, Chairman of Rallis India, and Vice-chairman of Tata Chemicals. While his company might not be a household name here in the US, it probably should be. With revenues of $22 billion, market cap of $60 billion, and 246,000 employees in 54 countries (including $3 billion revenue and 13,000 employees here in the US), Tata clearly deserves some respect.

My respect for Mr. Gopalakrishnan goes far beyond financial metrics. This man from India is a towering leader with clarity of mission and purpose that stands apart from any other CEO I have met or know of – and at the same time he is a humble, accessible, gentle human being who is willing to speak openly of the challenges and weaknesses of his organization. I found that combination of qualities and the unique approach of his many companies simply inspiring.

When have you heard the leader of a $22B global corporation say the following?…

“Complete the cycle of who you earn your money from and return it to them. Shareholder value is important, but much less important than ‘stakeholder value’. We are here to serve society, we must focus on building a better world, not just shareholders a good financial return.” This isn’t just rhetoric for Mr. Gopalakrishnan; Tata is owned by 13 charitable trusts who give away approximately $25 billion a year, making Tata one of the world’s top 5 charitable trusts. At the same time, it manages to outperform profit-focused competitors in growth and bottom line results. Hummm, the self-obsessed Larry Ellisons of the world provide an interesting contrast.

How should executives manage? “Work like the brick layer. Be humble. Lay the bricks that create the road for others to follow. You are entitled to work, but not entitled to the fruits of that work. That is the way to manage so as to be able to sleep well at night.” Not exactly a Gordon Gecko “greed is good” point of view.

His organization’s philosophy, demonstrated more through strong performance and inspiring generosity rather than just through words, is of especial interest to us at Cheskin, given our evolving focus on emerging markets and on social responsibility. A huge percentage of growth in the next 50 years is going to come from India and the other BRIC countries, which makes Mr. Gopalakrishnan’s thought leadership particularly encouraging for the world at large – and germane to any business leader who authentically wants to make a difference.

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