Businesses have to be ethical and worried about reputation….

This is perhaps one of the biggest lies that is told to children when they are in school and college. Then you have people like Warren Buffett who say “It takes a life time to build reputation and a very short time to lose it”.

So you tend to believe that reputation is very important, right?

Well, well.

Most shareholders look at the EPS and the growth rate of the dividend. Are they really bothered about what the promoter does in the evening? No. There is no way of knowing how ethical or otherwise the management is.

Is the public bothered about the character of Aamir Khan, Kamal Hasan, Dharmendra, …..- all these guys have had super hits do they not?

What about companies with a poor track record? Did we not continue to buy the red battery made by Union Carbide?

What about the personal integrity of Indian promoters? The number of skeletons in Indian cupboards are too much for one blog. “Go and do some research on a very famous Indian business house – which supplied poor quality of clothing to the Indian soldiers during the 1962 war. More Indian soldiers died because of the weather than those killed by the Chinese”. I was told this by an ex Indian army person. I am not sure how far this is true, but do not find it unbelievable.

What about companies abroad?

Well let us look at the big names – many of them are in India too. Chase bank, Ford, Nestle, Allianz, Coke, Random House, JP Morgan, Hugo Boss, IBM, Volkswagen, Kodak, Novartis, BMW, GE………..it does not get bigger than this, right?

The kind of things that these people have done is not amusing…by no stretch of imagination.

What did they do? Well, they worked for the Nazis.

Simple. They saw a business opportunity and they took it.

You know who is a big investor in a few of these companies, right?

So if your prof tells you reputation is important, tell him yes sir it is important, but only AFTER cash. The most imp thing is CASH.

Of course if you believe that the world will not bother, then it is different…..after all some investors have invested in some of these companies and go to town about it, do they not?

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2 Responses to “Businesses have to be ethical and worried about reputation….”

  1. Subra sir, good points to discuss among students /working community only .

    Prof of “cash is king “Bol Kar degree se dushmani kise Leni hai Malik!!!

    They claim to belong to the old school of thought and some o then do try hard for us to believe that respect is every thing

    Sadly, my generation has no poster boy left, we only look up to MG in crisp notes as the signboard 🙁

  2. Sir. a quiet voice of dissent if I may.
    from my very limited worldview from the other side of the table– I can name atleast 5 large FIIs that will not touch you with a barge pole if there is any disclosure which is remotely nasty.You may have world-best margins in your sector.

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