CII won't mandate CSR for India Inc, says Mittal
Priti Bajaj/Sindhu Bhattacharya
Monday, May 28, 2007  03:59 IST

NEW DELHI: A day after taking over as president of the Confederation of
Indian Industry (CII), Sunil Bharti Mittal conveys a steady sense of
purpose. He may not fully agree with the Prime Minister's suggestion on
pruning CEO and corporate salaries, but he is already talking of formulating
a code of conduct for India Inc that will gently prod companies to invest in
employee healthcare and education. The man from Ludhiana, who has taken
Bharti Airtel to the pinnacle of success, would like much greater
public-private partnership in developing infrastructure and bringing drastic
reforms in the education system. During his tenure as head of India's
premier industry association, he would like to find solutions to most issues
faced by India Inc. Mittal spoke to DNA Money at length about his vision and
agenda for the next 12 months.
Can what the PM said on CEO salaries be implemented? Is it true that large
businesses are not doing enough, giving back enough to society?
You have to read the PM's full speech.. He has said I celebrate your
(industry's) success and I am going to be standing behind you on a
continuous basis. That is the overarching message. He pointed out that large
sections of society are not becoming part of this success and some
(industry) sections flaunt their wealth and spend ostentatiously, which
creates additional pressure on those who are not part of the mainstream. We
at CII are already working to develop a code of conduct. This will ask
members if they are giving healthcare benefits, participating in the
education of their employees' children. This initiative should be in place
within a month. But yes, CII is not going to mandate that a certain
percentage of a company's profits should be used for corporate social
responsibility initiatives.
But is it true that business is not doing enough to address this issue?
Look at these big American businesses. They come from a garage, but build
large educational institutions. Then all universities are endowed by them
and they also get into healthcare. This is what the Tatas, Azim Premjis,
Infosys, and Bharti Foundation are doing. Many of us in new age industries
have begun to undertake similar initiatives. India has seen success (in
business) for a very short period of time. It is my belief that as success
grows, people will be more comfortable and will then start participating in
nation building. Some young business houses have already begun making
significant contributions to society and this will increase.
Any discord over the affirmative action plan within industry?
Not at all. But I would say small entrepreneurs may not be connecting to it
as yet. CII's effort would be to create 100-150 examples that encourage
others.
What about appointing ombudsmen for affirmative action? Who would you
consider appointing to this position?
The ombudsmen will measure and monitor what is being done in terms of
affirmative action. Stalwarts of society are being approached for this
purpose and they should be in place within a month or so. Four ombudsmen
would be appointed at regional levels with one Central representative.
The strengthening rupee has hurt domestic manufacturing competitiveness.
What do you think should be done about this?
The rupee has risen very fast and industry had no time to calibrate itself.
But in the medium to long term, industry will get suitably adjusted to this
fluctuation. Anyway, a rising rupee has also meant cheaper input imports .
there is some negative fallout, but it is not a huge negative. The dollar
and the rupee will find a natural level.
Manufacturing has been growing at a scorching pace but employment in the
manufacturing sector has not been growing at all. Is this being addressed?
Manufacturing growth has to result in increased people hiring. It is not
true that employment growth in manufacturing has been negative. In fact, it
has shown a marginally positive growth in the last two years. Close to 13
million jobs have been created in the services sector associated with
manufacturing because manufacturing companies get a lot of their work
outsourced - such as transportation, handling. We must consider this aspect.
But on the whole manufacturing should create more jobs and capacity
correction in certain sectors will take care of this.
How does CII plan to resolve the conflict between farmers and industry on
the issue of land acquisition?
Industrialisation is the way forward and for that land will have to be
acquired. Earlier, smaller portions of land were being acquired and people's
(farmers') aspirations were low. But this has changed..government should
look at rehabilitating displaced farmers and industry is also ready to take
on its share of responsibilities. Let the compensation (for farmers) be
built into the acquisition price of land.
Publication : DNA; Date : 28/5/07

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