- Home can be the place you want to leave
July 20, 2013
Amitava Kumar attempts to capture the essence of Patna in a short biography, quite unattractively titled 'A Matter of Rats'.
- Legal fees are on the house
July 20, 2013
Corporate social responsibility has entered India's legal corridors. Top law firms and lawyers are doing pro bono so that they can give back to…
- Cut the khap
July 20, 2013
Dressed in jeans? Feasting on chowmein? A Twitter parody of a disapproving khap panchayat is ready with a rap on the knuckle that makes you chuckle.
- In This Section
- Entire Website
From the Times Of India
- MOST POPULAR
Keeping it in the family
Blood is thicker than water and in Indian family business it is even thicker than money. Money is mistakenly considered the cause for family businesses to split. It is, instead, envy and ego among family businesses which cause them to split. Only failed siblings squabble over money because social and family networks ensure that siblings get their due, even when there is adultery, murder, bankruptcy, divorce, polygamy or whatever involved. Ajit Jain of Berkshire Hathaway once observed, "I think it goes back to what Warren (Buffett) said, 'If they (Indian family business) work, they work brilliantly. And if they're a disaster, they're very dysfunctional. ' There are a lot of family businesses that have stood the test of time in India".
The amazing and wonderful magical quality of family and social ballast steadying the most hard-bitten Indian family business along with the natural mellowing of youthful spats is now so evident in the Ambani family of Mumbai. The two brothers, Mukesh and Anil, and their spouses Nita and Tina are as different as chalk and cheese. Mukesh is an intensely private person and wife Nita the quintessential uberaffluent Indian family business spouse, active socially but carefully a step behind, involved only in the arts, social sector or softer areas of business. She has recently entered the limelight, tickled to be the matron of her IPL team. Anil was once the flamboyant, Porsche-ed brat, Bollywood party beast, married actress trophy wife Tina Munim, he evolved into marathon wannabe, neophyte politician - a largerthan-life image and ego, very unusual for the serious Indian family business scion.
After founder Dhirubhai Ambani died, wife Kokila struggled but failed to keep some semblance of unity. There was a loud and acrimonious split but even here family loyalties and compacts kept it almost entirely out of court. For a while, it looked like Anil Ambani was turning his back on his roots as he tried to twotime between running his own ADAG group created in the same flamboyant image. Anil hung around in politics and other serious non-business activity before sense prevailed and he retreated to his more natural role as a leading Indian family business head. In spite of investor pressure, his business valuations have appreciated substantially.
Kokila must have been thrilled in the evening of her life to see the bonhomie among the two brothers, their spouses and other relatives when the family celebrated the marriage of Mukesh and Anil's niece. Then from the thaw emerged a business plan. The 2014 general election will pop surprises and Anil Ambani needs a Plan B if, say, Lok Sabha numbers and Tamil Nadu politics drags him and his telecom business into a debiliating maze of court cases and political oneupmanship. Anil has signed on Mukesh as the biggest customer of his telecom business and any rival must count on Mukesh now protecting Anil's back. Absolutely amazing! Anil did not take a hand-out from his brother and Mukesh kept clear of ADAG management;yet the core of the business is now secure. Mukesh has emerged as a business patriarch and Anil has shown maturity to protect his empire. For both, the wedding stimulated the normal middle-aged human emotion to gather around family, childhood and some professional cronies, to settle estate, put salve on festering sores of earlier times. Power and pelf are irrelevant in the desire for ease and peace.
There is a saying common in India, "Give me wise, successful relatives and neighbours and failed fools for rivals. " Or, "If you don't look out for your brother, what would you do for others?" ask all Indians. This is the credo of national nepotism and crony capitalism. It is a family obligation and makes sound social and financial sense to 'lift' the family with you. Nothing affords a successful businessman as much prestige in his world as sharing the action with his more mediocre family.
Lakshmi Mittal of the Ispat group has blazed a path very different from almost all other Indian businessmen. His step-siblings Pramod and Vinod Mittal have not been as successful in their ventures such as Nippon Denro Ispat. They have been based in London for some years now, operating in the steel industry, undoubtedly under the benign shadow of their elder step-brother.
While Indian business families seem to find such harmony regularly, where shared values, filial piety, family love, money and business opportunity come together in a big bang, it is by no means a smooth and obvious road. Take for example Anshu Jain of Deutsche Bank and Ajit Jain of Berkshire Hathaway who say they are not related but have known each other from childhood. They have Indian business community genes and every bit player in the world's two largest financial markets on their cellphone contact memory. Yet they haven't fused into a global financial powerhouse. I believe the missing element is the lack of blood kinship. Or, banker Rana Talwar left at the fringes of the Indian financial system although his father-in-law KP Singh is now one of India's richest men. Or, Naina Lal Kidwai, who continues to work for HSBC even though she is a Thapar descendant. In these two cases, maybe they are linked to the distaff side of these families and not brought into the kitchen family council. Last but not least, is the shameful patricide incident of hotelier and real estate tycoon Deepak Bhardwaj where it is still quite incomprehensible how the son believed that his father now liked some other woman, that he would be disinherited and would be unable to keep people from pointing fingers at him for the rest of his days.
The success of the Indian family business when compared to other ethnic family business traditions is that its in-built strengths - male primogeniture, nepotism and cronyism - are most successful when carefully limited to business and finance. Business and democratic politics are uneasy and suspicious bed-fellows and business cronies and non-democratic players are playing Russian Roulette. Vijay Mallya and Anil Ambani tried and failed to as successful politicalindustrial faces. Kamal Nath has stepped away from his industrial empire and smaller players like Deepak Bhardwaj and Ponty Chadha came to a sorry end. It will be interesting to see how young Naveen Jindal fares in the years ahead.
(Sudipt Dutta is author of 'Family Business in India' by SAGE Publications India)
Register for Full Access to the Crest Edition
Don't have a Facebook Account? Sign up for Times Crest here.