Corporate governance and public policy: a tailspin.

Amaan Amlani
Aug 9, 2017 · 4 min read

All companies that operate in India face striking challenges in dealing with public policy and corporate governance: they enact an ever-changing, ever-expanding spectrum of detailed legislation and regulation to protect workers, consumers, investors, and the public welfare, and these diverse rules shape what companies can and cannot do. Moreover, corporations are not trusted in this era of populist discontent because their role in shaping public policy is often seen as bought by money and concerned solely with private not public interests.

While my experience campaigning for better healthcare and drug prices in South India have brought about a fruitful change in the social circumstances of many personages-experience has also taught me about how a lack of mediation between company monetary incentives and public affairs are causing a downturn in effective corporate governance and a stir in Indian social affairs. In envisioning myself as a potential global leader, I have spent a majority of time scrutinizing how capitalism and socialism act as great dividers of opinion, and an experience of being an activist campaigning against government and private companies for pushing social changes- I feel I would be a little well-suited in emphasizing this subject:

To meet this daunting challenge of neglecting social welfare in favour of personal gains, Indian corporations need a strategic and balanced approach to government and public affairs, but many don’t have one, instead adopting only defensive “social relations” tactics. Too few businesses have sought to make a systemic approach to public policy an important dimension of their global standing, and too few are capable of advancing their private interests in a way that also advances genuine public interests.

Potential public policy-related risks and opportunities for companies arise across a spectrum of political and economic systems. Issues bearing significantly on the business emerge not just in legislative, executive, or regulatory settings; they can also arise in litigation or transactions or adoption of ethical standards necessary to policy proposals. They can be cross-cutting issues which impact the whole corporation-taxes, healthcare, telecommunication to name a few.

Even with strong CEO direction, our leaders who are crucial to its success may not share the commitment or understand the time required. They might not have a realistic view of social processes or a feel for balancing public and private interests or understand the contingency of the businesses’ responsibility to the only entity that matters-the society.

A needed approach

The right approach for Indian companies needs to start with the CEO’s commitment to strategic and operational processes that include an important public policy dimension. Specifically, the chief executive should require division leaders and staff executives to integrate dimensions of public policy issues into their annual plans.

To lead this approach effectively, it’s key that the company maintain legitimacy by not seeking short term advantage from government without any policy basis: for example, indulging in the “crony capitalism” of unnecessary but hard-to-repeal concessions, franchises, tax exemptions, subsidies, and regulatory loopholes, which erode corporate trust and credibility.

In routine strategic reviews, leaders should present an agenda of policies relating to their line of business or area of expertise in nations all across the globe. An essential element in ensuring that this corporate public policy process is effective is having policy experts and political experts inside the corporation. These experts help enact and implement the desirable policies, translating proposals into feasible results through communication, advocacy and alliance-building.

Statistics show us real-world examples like those of corporate resurgences in India where public policy-a major concern for enactors of corporate governance and shareholder activists has improved social affairs dramatically. Policies concerning social welfare as part of the biggest and most powerful companies have paid off exorbitantly well: Reliance Industries, for one, has successfully implemented public policies and has transformed India into a cultural hub where prioritization of long term social values and public welfare has cemented Reliance as not only the best ‘public’ company but has also indicated how corporate governance can bring a meaningful change in lives of the people.

While I certainly believe that profit making and global competitiveness should be the sole motive of Indian companies, there should be an accountability to the society, which craves ethical standards and public welfare as two of its lead frontrunners in representing India as a global business hub where its excellent public policies and sound corporate governance can become an inviting source for other global businesses to challenge conventional approaches and create social welfare for its benefactors, and to paint a bigger picture-the citizens of the world.

36 Conscientious

36 Conscientious is a research publication that is dedicated to transitioning strict corporate governance in companies and push for social changes that can be beneficial for the society. We also publish articles on other social issues like healthcare, real estate and more…

Amaan Amlani

Written by

36 Conscientious

36 Conscientious is a research publication that is dedicated to transitioning strict corporate governance in companies and push for social changes that can be beneficial for the society. We also publish articles on other social issues like healthcare, real estate and more…

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