As the Indian economy gallops towards what many believe is a new normal -- 8 to 9 percent economic growth –- its business leaders are gradually waking up to the importance of philanthropy. This formed the theme of a free-wheeling audience discussion at the cover launch of the Forbes India Rich List issue on the evening of September 29, 2010 in Mumbai.
Titled “Wealth Creation in the Next Decade – Towards a More Inclusive India,” the audience comprised India’s top industrialists and corporate heads. Anchored by CNBC’s Menaka Doshi, the discussion took up the issue of wealth creation and what it amounted to.
According to Subroto Bagchi, vice-chairman of Mindtree Ltd. while there are several models of wealth creation, for him wealth is truly created when a person leaves a lasting legacy behind. “Physical infrastructure, intellectual and emotional legacy,” are its hallmarks. At present, India seems to be equating growth with consumption and “we need to debate that,” he added.
A majority of business leaders believe their organisations are doing enough to promote inclusive growth with 51 percent saying yes and 31 percent saying no. (The rest abstained.) Niranjan Hiranandani, MD, Hiranandani Group pointed out that as creating wealth for shareholder is important, the inclusive growth mantra may not be heard in the boardroom as it should, but individual giving must take care of these shortcomings. Significantly, 85 percent said that the quest for inclusive growth would not reduce their competitive edge.
Individual giving has been in the news recently with Bill Gates and Warren Buffet calling upon the rich the world over to donate 50 percent of their wealth to charity. In September, as part of “The Giving Pledge” they travelled to China to impress upon the country’s millionaires the importance of giving. The two have termed their visit a success despite only one billionaire agreeing to donate. Here at the Forbes India discussion some said that the lack of credible avenues to donate to made giving a difficult choice. If Gates and Buffet reached out to the Indian rich, 48 percent said they would be willing to donate, 39 percent said no and 12 percent abstained. The Indian rich give 0.2 percent of their wealth to charity.
Amongst members of the audience there was a lively debate on whether it’s only charity that can cater to promoting inclusive growth. For Gita Piramal, a business historian, banks and governments do a lot of work in educating small businesses that in her mind led to inclusive growth. Ashwin Dani, MD of Asian Paints, said the single biggest business impediment that large businesses face is land acquisition. India needs to see how that model can be tweaked to promote growth that is inclusive.