In its fight against corruption that is harming India’s image as a country to do business in, trade body Confederation of Indian Industry (CII) is betting that a campaign, in which it is showcasing successful small and medium enterprises following ethical business practices, will strike a chord.
Despite an independent judiciary and clear rules detailing different processes at the central, state and local levels, India ranks a lowly 70 among 163 countries surveyed for perception on the degree of corruption as seen by business people and analysts, according to a 2006 report by Transparency International, the global corruption watchdog.
While reforms have reduced the time to set up a business in India to 35 days in 2006 from 86 days two years ago, India ranks 134 among 175 nations in the ease of doing business, the International Finance Corp. said in a report last year. “At virtually every international forum, the issue of corruption was top on the agenda,” said N. Srinivasan, adviser to CII president and coordinator of ‘Integrity India’ campaign.
The campaign was launched in October last by N. R. Narayana Murthy, chairman and chief mentor of software firm Infosys Technologies Ltd, which is well regarded for its corporate governance standards. The campaign has covered nearly 10,000 schoolchildren across five cities.
Companies “can go on doing their work without being in a denial mode (on corruption). But the intention is to tell them that they can do business by being on the right path,” said R. Seshasayee, the outgoing CII president. The trade body has 6,300 members in India.
Firms such as Conzerv Systems Ltd, a Bangalore electricity equipment company, and Micromatic Grinding Technologies Ltd, a small enterprise in Ghaziabad, are being lauded for maintaining ethics and integrity. “We have a clear policy that you don’t bargain with the devil,” said Hema Hattangady, CEO, Conzerv, whose Rs75 crore business is growing at 45% annually.
Small enterprises typically interact more with local officials from electricity, commercial taxes, excise and fire force departments and often are forced to shell out “speed money” to get government approvals for running their units.
CII hopes to replicate the success of a quality drive it began in the early 90s. Thousands of Indian companies today are certified by the International Standards Organizations on business and customer service operations. “India is now recognized for quality products and services, not just a place for low-cost activity,” said Srinivasan, who set up the CII Institute of Quality in Bangalore. Some 350 companies throw open their businesses for scrutiny by external observers while competing for CII’s annual business excellence awards every year.
Young Indians, a CII sister organization that has over 3,000 members, interacts with the young in schools and colleges on ethics, probity and transparency and educates them on the use of tools like the Right to Information Act.
“It is the mindset that things can’t change that encourages corruption; the mindset needs to change,” said Narayan Sethuraman, chairman of Young Indians who is the managing director of WS Industries in Chennai. “The mission to stem corruption is a marathon; it is not a 100-metre dash.”