A business interest in politics

A business interest in politics

India is widely referred to as a vibrant democracy and, indeed, there are several indications of vibrancy on the political scene. But events such as the ruling party failing to keep a promise of handing over power to a coalition partner, as happened in Karnataka recently, and the Anand Mohan episode in Bihar, where “senior" politicians such as George Fernandes and Sharad Yadav came to the defence of a person sentenced to death for murder by a sessions court, seem to give a different picture. What do such instances, which come up regularly, say about the state of our democracy? And what does it have to do with business?

Though dictionaries define politics as “the art or science of government", politics is essentially the dynamics of power in a society or a group, i.e., who gets power and how. Business as a part of society cannot really divorce itself from such dynamics. Business usually covers its bases by making donations to political formations of all hues, but is that enough or appropriate?

Business operates in the larger societal environment which students of organization theory have been studying under the rubric of organizational environments. Political environment is an important component of organizational environment. The events described above give an indication of the state of the political environment in the country.

Before liberalization began, and the same political party was in power at the Centre and in the states, the political environment of business was stable and predictable. Restructuring of the economy, accompanied by the dawn of the era of coalitions, particularly at the Centre, and regional parties coming into power in several states, changed beyond recognition the political landscape that business had to traverse. A business with operations in multiple states of the country has to concern itself with the preferences of the different political formations in power in the states and with their complex relationships in coalitions that often defy all logic. In addition, frequent elections with consequent changes of government create uncertainty in the political environment.

The biggest confounding factor in the political environment of business is criminalization of politics: people with criminal backgrounds becoming politicians and elected representatives. More than half the MLAs in the last UP assembly had criminal cases pending against them (206 out of 403). The number in the current UP assembly is 159. Around 20% of the members of the current Lok Sabha have criminal cases pending against them. The charges in several of these cases are of heinous crimes such as murder, robbery, kidnapping, and not just violation of Section 144, or something similar. When the issue of disqualifying legislators from continuing to be members of legislatures if they are convicted for more than two years’ punishment in criminal cases came up before the Supreme Court earlier this year, the Government of India itself argued in favour of such convicted criminals continuing as legislators, saying in an affidavit, “The government in power may be surviving on a razor-thin majority where each member counts significantly and disqualification of even one member may have a deleterious effect on functioning of the government."

The phenomenon of criminalization of politics acquired ominous proportions with no information being available to voters about the criminal background of candidates contesting elections. That is what made several civil society groups seek transparency in the electoral process by asking candidates for elections to disclose their criminal and financial background to enable voters to make an informed choice. It was as a result of those efforts that the Supreme Court, in a landmark judgement delivered on 13 March 2003, made it mandatory for all candidates contesting elections to Parliament and state assemblies to submit an affidavit, as an essential part of their nomination forms, disclosing information about their criminal, financial and educational backgrounds. This judgement came after a four-year-long effort in which 22 political parties, representing the entire political spectrum, unanimously decided to prevent such disclosure from happening, the Central cabinet going to the extent of insisting that an ordinance be issued even after the President returned the ordinance once. This hard-fought success was the first step in the process of bringing about some transparency and morality in the electoral and political process in the country which, of course, will have to be a long and sustained effort, otherwise the political environment of the country as well as that for business will continue to be turbulent and also vicious.

Business can, obviously, achieve much more for society and itself if the political environment is predictable and, more importantly, works according to some commonly and morally acceptable standards. It may be in business’ own interest to support transparency and cleansing of the political process in the country even if it doesn’t get involved in it directly.

Jagdeep S. Chhokar is a retired professor of IIM Ahmedabad, and works on improving democracy and governance in the country. Comments are welcome at theirview@livemint.com