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Business Culture in India

Corporate ethics programs make a difference, but not the only difference

Business Culture in India

Greetings and courtesies
Indians greet each other (and say good-bye) with the Namaste, which is formed by pressing the palms together (fingers up) below the chin and nodding the head. When greeting superiors or to show respect, a slight bow is added. When meeting foreigners, Indian men will shake hands. Indian men do not generally shake hands with or otherwise touch women (as a gesture of respect for a woman's dignity and privacy). Indian women who are educated or familiar with international customs may offer their hands to foreigners as a courtesy. When meeting a woman, a man should wait for her to initiate a handshake. If she does not, smile and nod slightly. When in public, men should not initiate a conversation with an Indian woman who is alone. Indians value titles; if someone has a title use it when greeting them. The suffix after a last name is a general term of respect. Indians generally ask permission before leaving other people. Showing respect for others (especially those who are older) is very important. In a group, greet the eldest person first.

Decision making
Decisions are made slowly. Indians require time to discuss every aspect of a deal, and then usually take more time before giving a final answer. Be patient and plan other activities while waiting. Impatience is viewed as rude, and high-pressure attempts to get things done faster will be resisted and resented. Decisions are made at the top of the hierarchy, so whenever possible cultivate and maintain good relationships with the highest-ranking executives.

Topics of conversation
Talking about your friends and family is an important part of establishing a relationship with those involved in the negotiating process. Indians tend to be enthusiastic about discussing politics and religion. They enjoy opinionated conversations and don't necessarily want to hear only bland pleasantries from a foreign guest. Nevertheless, refrain from tackling these controversial subjects unless you are well-informed.

Topics of Interest: Indian traditions, foreign countries, families, cricket, politics (if you know what you're talking about).

Women
India is a male-dominated society. Foreign businesswomen should experience few problems but, in general, women are not accorded the same level of respect as men. Indians who have had more exposure to international dealings will be more used to dealing with women; older men will usually be more traditional and less open. Behaving in a professional, confident, and poised manner will help overcome some of this resistance. Women should be particularly aware of any behaviour that might be considered flirtatious. Women who wish to entertain a male associate should do so during the day (business lunches are more popular than dinners anyway). An Indian man will probably offer to pay the bill, but will not push the point if you politely insist on paying. Women should be prepared for personal questions about their age, marital status, and whether they have children. (These are common topics of conversation and are asked of both men and women.)

Meetings
Indians value punctuality in others, but will often be late themselves. Also, traffic is extremely heavy in Indian cities and sometimes prevents people from getting to an appointment at all. This can require rescheduling, so if possible build a few extra days into your travel plans. Indian executives generally prefer to meet in the late morning or early afternoon. Schedule appointments well in advance (30 days ahead is suggested) and reconfirm appointments when you arrive in India. Most meetings will begin with pleasant small talk over a cup of tea and perhaps food. Do not refuse any food or drink offered. Always accept; if you do not like it, leave it in front of you. Indians usually entertain in private clubs.

Business attire
Business clothing is casual but neat. Standard attire for men is pants and short-sleeved shirts; however, a jacket should be worn to initial meetings or when seeing government officials. For more formal meetings (and during the cooler season) a lightweight suit will suffice. Do not wear leather clothing or any accessories made from animals. If you are traveling to New Delhi in northern India during the winter months, bring warmer clothes. During the monsoon season, bring a few extra changes in clothing and an umbrella and large plastic bags if you intend on keeping your things somewhat dry. The damp weather does not allow things to dry properly. A handkerchief or cloth may prove helpful to dry off any wet spots where you must sit.

Women should wear casual dresses or pants ensembles. It is acceptable for foreign women to wear the traditional sari (Indian women in particular admire foreigners who do so), but wear a sari only if you feel comfortable in one. Women should always dress conservatively. Do not wear skirts that rise above the knee, and never wear a sleeveless dress or blouse. Men should not wear Indian caps (they are generally worn by villagers and lower-class people).

Corporate ethics programs make a difference, but not the only difference

Employees in organizations with formal business ethics programs are more likely to report employee misconduct, but top management that speaks and behaves ethically also is a major factor in building an ethical culture, according to a major national survey released May 21 by the Ethics Resource Center (ERC).

The 2003 National Business Ethics Survey (NBES) asked 1,500 workers nationwide about four key ethics program elements: written standards of conduct, ethics training, ethics advice lines or offices, and systems for anonymous reporting of misconduct. The more program elements that were in place, the more employees said they reported misconduct they had observed, the study found.

Seventy-eight percent of employees in organizations with all four elements said they reported misconduct, compared with 67 percent in organizations where there were written standards plus at least one other element. Fifty-two percent said they reported misconduct where there were written standards only. Where no elements of an ethics program were present, 39 percent said they reported misconduct.

Overall, employee reporting of misconduct increased to 65 percent in 2003, up from 57 percent in 2000 and 48 percent in 1994, when the survey was first conducted. But the study also reported the first overall drop in observed misconduct from 31 percent in 1994 and 2000 to 22 percent in 2003.

SHRM's own studies show that the majority of HR professionals believe they are looked to as the primary ethics resource in their organization," Messenger added. "They increasingly must provide leadership, along with senior management, to foster an ethical corporate culture from top to bottom."
"Formal ethics programs are important, but, alone, they are not going to get the job done," said ERC senior researcher and survey author Joshua Joseph at a briefing. The study showed that where management both talks and behaves ethically, employees observe far less misconduct.

Specifically, where top management talks about the importance of ethics, informs employees, keeps promises and models ethical behaviour, 15 percent of employees observe misconduct. Where employees feel that top management only talks about ethics or does nothing, 56 percent report observing misconduct.

In 2003, 82 percent of employees said that top management in their organizations keeps promises and commitments, up from 77 percent in 2002.

ERC characterized such findings as "both surprising and important given the troubled economy and series of recent ethics scandals in major corporations and non-profit organizations."

But not all the news is good. The survey report says employees under 30 are far less likely than others (43 percent compared with 69 percent) to report observed misconduct. Younger managers with low tenure are about twice as likely as other employees to experience pressure to compromise company ethical standards.

Despite overall increases in reporting misconduct, nearly half (44 percent) of all non-management employees said they did not report misconduct they observed. Why not? Because they believed that no corrective action would be taken or feared that reports would not be kept confidential, the study found.
Workers in organizations undergoing mergers, acquisitions or restructuring are particularly vulnerable to pressures to compromise ethics, the study found. They report observing misconduct and feeling ethics-related pressures at nearly double the rate of other workers.

ERC collected survey data over a seven-week period between Jan. 31 and March 17. A representative sample of survey participants was selected using a random-digit dialing procedure. Eligible participants were over 18 years of age and employed at least 20 hours per week. Employees at all job levels were included.

The ERC works with businesses, non-profit organizations, schools and governments to create ethical work environments.