"Crony Capitalism"? Incorrigible Capitalism?

In the Economic Times (20.12.10) Arun Maira, Member Planning Commission and a management consultant wrote a lead article on “representative institutions” and “participative processes”. The problem with these articles is that a great deal of theoretical cogitation goes on in them,  some analysis which is almost like a revisit, but no new intellectual pathways are created. I guess the same could be said of those of us who have the temerity to blog on these matters!!


The burden of this article is that more economic reform is needed to give business the freedom to self regulate itself. A grand idea if ever there was one. As far back as one can remember, those of us who came into regular contact with the corporate world and had to deal with the fallout of their sundry ‘misdemeanours’, we felt that hiding behind statutory requirements was never enough. Going beyond what was mandated to set a more ethical, more caring, more concerned and even a more humane behavioral framework that took the real needs of ALL stakeholders into account, was a moral reponsibility.


Arun Maira quotes Richard Reich from his book ‘Supercapitalism: The Transformation of Business, Democracy and Everyday Life’  that democratic societies must have strong institutions to represent stakeholders. In the world today the economies that are sustaining themselves adequately are those where institutions exist that can support the representation of diverse interests and work for consensus. Theoretical analysis of the reasons why self interest is the ruling motivator of the business world in India is good but not enough.

I fully endorse his view that ” Policies and plans must not be made by the government for industry as it used to be in the license raj. They must be made with industry.” Business must participate. Industry associations must see this as a core mandate. All other stakeholders must be brought into the mix.  Stakeholder representation and a common platform should be used to move the government in a direction that works for business and the public. This could perhaps lead us out of the current morass into something closer to enlightened capitalism.

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