‘The commitment to ethics helped Tata Group weather many a storm’

In two years, the Tata Group will celebrate its 150th anniversary. What did it take for this Group to evolve over this century and a half of change and emerge strong?

What made the group retain its position among the top Indian corporate giants in the last 25 years of liberalisation of the Indian economy, when the domestic corporate sector faced an existential crisis following global competition?

Participants at a meeting organised by the Chennai International Centre got valuable insights into this question when Mukund Rajan, a member of the Group Executive Council at Tata Sons, Tata brand custodian and group spokesperson, expanded on the theme, ‘Continuity through change – Tata in the era of liberalisation’.

“It has had its fair share of trials and tribulations but a strong commitment to value systems and ethics,” have contributed to its sustaining and growing under tough environments, he said.

Willingness to learn to face global competition, benchmarking itself to the best in the business, nurturing innovation and an institutionalised code of conduct that embedded a commitment to transparency and ethics throughout the organisation are among the reasons, said Rajan who is also the Chief Ethics Officer of the group. In 1991 when liberalisation took off, the then Chairman Ratan Tata was convinced about open markets. He had committed the group to face global competition.

The group, which was worth $6 billion in 1991, has now grown to a more than $100-billion conglomerate.

Rajan who had served more than a decade under Ratan Tata, Chairman of Tata Sons, said the Tata Business Excellence Model created in 1994 was the first step in building global standards.

Inspired by the US’ Malcolm Baldrige National Quality Award, it was a formal system for benchmarking, assessing and building skills. Through the 1990s the group had entered into partnerships with global giants such as IBM, Honeywell, and AT&T.

By the turn of the century the group had emerged strong enough to embark on a decade of global expansion both organic and inorganic, through acquisitions. These included landmark acquisitions such as Tetley, Daewoo’s commercial business in Korea, Corus and the Jaguar Land Rover.

Through out this evolution, the group has maintained a no-compromise attitude with a strict adherence to code of conduct. This code was refreshed last year to update it in line with the changing environment. This commitment to society helps it to look at the long term.

Its goal to touch the lives of at least one-fourth of the global population by 2025 ensures that the next 25 years will “as good as the last 25 if not greater,” he said rounding off the third meeting of the Chennai International Centre.

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