OF THE several observations and comments that have followed the homecoming of NR Narayana Murthy as executive chairman of Infosys, the loudest have related to the appointment of his son, Rohan, as one of his two executive assistants. Like his father, the new Infosys employee will draw a token salary of Rs 1. He has been promised no leadership role and his father has clarified he is not being groomed for the job of CEO or anything of the sort.
There is no reason to disbelieve the senior man. As one of the founders and the doyen of Infosys and indeed the IT industry in India, Narayana Murthy has a reputation for ethical conduct. Thus far he, and the co-founders of Infosys, have studiously kept their children and families away from Infosys and not sought to convert it into a dynastic firm. Why then has the bringing in of Rohan evoked such a response and been seen as such a crossing of the Rubicon?
In a sense, this is because of the reputation and indeed the mythology that has surrounded Infosys. Despite its current travails — and irrespective of whether or not Murthy, at close to 67, is the right man to lead it into the future; that is a separate issue — Infosys remains the sort of fairy-tale corporation that Indians want to believe in. Set up by first-generation entrepreneurs, middle-class technocrats with little financial capital and no history of business in the family, it is the type of meritocratic saga that galvanises young minds and fires dreams. It also stands out as the single major company that blossomed in the period after 1991 — and the inauguration of economic reform — without a connection with business or political lineage and family wealth and networks from the old India.
Infosys is an exceptional company in this regard, and the response to the recruitment of Murthy’s son is recognition of how much people value that exceptionalism. Nevertheless, that exceptionalism is also a matter of embarrassment for India — not because of Infosys’ tradition of scrupulousness, but because it is so alone in the Indian corporate landscape. That India has no other post-1991 success story without a legacy or a hereditary fingerprint is telling of the flawed nature of liberalisation.
Only in this country do we call privileged children of millionaire parents, born wealthy in the first place, risk-taking entrepreneurs. In reality, so closed is the Indian system and so tight is the regulatory net that continues to strangle it, that the energies and dynamism of genuine capitalism continue to be alien to it.
It is not that family-owned companies have no business being in business. Some of the world’s leading corporations continue to be substantially owned and even run by families. Take Beretta as a random example. The Italian firearms company was set up in 1526 when it got its first contract from the militia in Venice. This was the same year in which the Mughal Empire was born in India, with Babar’s victory in the First Battle of Panipat. The Mughal dynasty is long done but Beretta continues to thrive, still run by a descendant of its founder.
Yet for every Beretta there are several examples of widely-owned corporations, run by professionals who have no relationship outside the workplace. Family-run firms and John Doe start-ups co-exist from North America to Europe to Japan. In India, the ratio is enormously skewed though — and a case like that of Infosys is rare.
It is easy enough to say that influential families dominate Indian society. From cinema to politics, from playing tennis to performing magical tricks, dynasties seem to be the norm. So why should the economy and the corporate universe be different? That is a lazy question. One of the mandates of liberalisation was to create a society that offered equal opportunities under conditions of equality, that made it simpler for anybody with an idea and a drive, with intellect and determination, with inspiration and perspiration — and without a famous surname — to set up the company of his or her ambitions: to break every glass ceiling. As it happens, in the past 22 years only Infosys has been able to breach that glass ceiling.