April 11, 2006

Prominent Businessman Tata '67 Delivers Hatfield Lecture

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In an era of cutthroat business practices and extreme competitiveness, it can seem as if there is no room in industry for social responsibility. Such is not the opinion of Ratan N. Tata ’62, chairman of Tata Sons, Limited and the 2006 Robert S. Hatfield Fellow in Economic Education. Tata spoke in Kennedy’s Call Auditorium yesterday about the social responsibility of industry in a lecture entitled, “The Imperative for Change in the India of Today.”

Tata was appointed chairman of Tata Sons in 1991 and has increased the revenues of the Tata Group, India’s largest business conglomerate, more than six-fold during his tenure. Interim President Hunter R. Rawlings III introduced the lecture with great praise both for Tata and for the organization, which was started by Tata’s great grandfather in the 19th century.

“The Tata Group is global in scope but remains true to the principles of its founder,” he said. These principles include integrity, understanding, excellence, unity and responsibility, according to the group’s website.

Rawlings explained that selection as a Hatfield fellow is the highest distinction Cornell bestows on individuals from the corporate sector. He said that this was only the second time that a Hatfield fellow was selected from outside of the U.S. and that he was “delighted to bring an international flavor to this tradition.”

Tata broke down the “imperative for change” into three categories; changing tradition in a country that has been tradition bound, operating with principles and values in an environment where many are degraded and acting with social responsibility.

Much of the lecture and the majority of the questions from the audience were devoted to the issue of social responsibility. According to Tata, by 2030 India will have the largest working population in the world and industry needs to be concerned with creating opportunities in rural areas.

“[India’s industries] need to understand they have a responsibility that goes beyond making a product,” Tata said. In Tata’s view, industry has to strike a balance between creating value for shareholders and having a responsibility to the country at large.

Other topics discussed by Tata included the relationship between India and the U.S., which Tata believes is stronger than ever, and the importance of competition in industry.

Following the lecture, a large portion of time was devoted to answering questions from the audience. The questions ranged from the Tata Group’s role in clean-air initiatives to improving education and to providing health care for the poor.

“I didn’t realize social responsibility would get so much attention,” Tata said.

Tata said that health care is the responsibility of the government. Indian industry can support the government but the problem is “a national problem, a government problem.” Similarly, Tata said that industry can support every move the government makes to reduce pollution but cannot take responsibility for what needs to have legislation behind it.

These responses elicited a skeptical reaction from some students. Keith Poe grad was disappointed that, when presented with concrete questions of how Tata Sons could lead the way in social responsibility, Tata’s responses were vague and essentially placed responsibility not on industry but on the government.

“It would have been nice if there had been a PowerPoint presentation showing what [Tata Sons] actually do,” said Lillith Coto ’06.

Sudeshna Mitra grad pointed out the inherent contradiction between initiatives that are designed to create profit and initiatives designed to help people. According to Mitra, Tata cannot, in the world of industry, carry out what he says should be done.

Peter Meinig, chairman of the Board of Trustees, had a different opinion.

“Mr. Tata is really a prime mover in moving India into the 21st century. It is wonderful to have a Cornellian who has a concept of social responsibility and is implementing that as a business leader,” he said.

Kevin McGovern, a member of the Board of Trustees, also praised Tata.

“[Tata] combines a balance of business and social responsibility better than anyone else in the world,” he said.

Archived article by Tamar Weinstock
Sun Contributor