Business Governance and Society

The classical theories of economic growth believe that production in the industrial sector is largely dependent on agriculture for contributing various factor inputs. Many theories have emerged supporting the phenomenal achievement in the Indian agriculture sector over the years. This chapter attempts to analyze the productivity growth in the Indian agricultural sector and provide a policy framework in the context of the profitability and sustainability of farming sector activities that employ two-thirds of India’s workforce.

For years, the human resources function has shouldered much of the responsibility for managing people, but it has often had to do so with too little real information while being too segregated from the business. Talent analytics, which uses advanced technologies to process billions of data points to discern previously unseen patterns of potential value, shows the promise of basing decisions about hiring, training, improving productivity, and retaining talent on hard numbers and even delivering insights that can make a company more competitive. This exploratory study provides an overview of the talent analytics practices of India’s Balmer Lawrie & Co. Ltd., which is a company engaged in a variety of businesses producing products such as steel barrels, industrial greases, specialty lubricants, corporate travel and logistic services with sites throughout India and in Bedford in the United Kingdom. Talent analytics help the company foster and sustain innovation by revolutionizing not only the practices of HR but also how insights about workforce performances can be derived and applied to achieve real improvements in business performance.

Customer Relationship Management (CRM) is total alignment of business around the customer. It is a business practice focused on customers; being customer-centric and staying customer-centric. Customers know that the biggest gift they can give to an enterprise is their loyalty. They expect to deal with enterprises the way they like. Enterprises won’t satisfy the customers unless they re-engineer their processes to be customer focused and customer oriented. They have to keep track of the customer’s past activities in order to influence the customer’s future activities. Therefore, there is no substitute to customer-centrism. The objective of a business should be to create customers and keep them, and CRM helps in doing just that.

The Bottom of the Pyramid (BOP) typically refers to the low-income group of customers, which is a big segment in India. The marketing discipline has historically developed through the context of the industrialized or developed world, but given the size and unique characteristics of this segment of consumers, an independent approach is needed wherein the customers are understood within their context, and businesses strive to serve them and earn their profits. Because the customers are typically impoverished and there are certain assumptions that a marketer holds about this segment, there is a gap in crafting and delivering products and services for this segment that stops at exploring the sector’s profit potential. This study explores the customers in this segment with a view to understand what ultimately satisfies them and gives them happiness in their purchases. There are some interesting findings that emerge and a substantive theory that unfolds in the study.

Emerging economies of the world are experiencing changes in the fabric of society as well as the work place. Employees working in a high intensity, always connected, multi-cultural, team-based and interdependent work environment are experiencing increasing work-family conflict. There is an urgent need to explore the response mechanisms to this conflict in an attempt to categorize the more effective mechanisms from the ineffective. This study aims to understand how employees in a high-pressure work environment have coped and developed mechanisms to manage this conflict. In-depth interviews were conducted with the respondents to gain detailed insights. The findings suggested that there is a passive acceptance of the conflict by most respondents, despite psychological strain reported by most of them, and adjustments in the family domain are more common than in the work domain. The study adds to the existing pool of literature on work-family conflict by exploring individual response and adjustment mechanisms.

The Gandhian philosophy of trusteeship is a moral foundation of Corporate Governance. According to this philosophy, the wealth creators are trustees of society and they have a responsibility to look after all components of social, economic and natural environments. Those firms that have a broader aim than profit maximization focus on ethical practices in business, accountability towards stakeholders and the environment in which these operate. Primarily, transparency, accountability, responsibility and fairness are core guiding principles of Corporate Governance. Corporate Governance is significant for the organizations whose motives are long-term sustainability, growth and good corporate image.

This chapter is an attempt to study corporate governance and its impact on financial performance as well as the quality of financial reporting of top Indian companies. In this research, we examine the questions like What is the scope of corporate governance disclosure?, Does the corporate governance disclosure influence the financial performance of the company? and Is there any correlation between corporate governance disclosures and growth and profitability parameters of firm? and does corporate governance affect the quality of financial reporting?

This study contributes to creating awareness and assisting companies in achieving better performance in social and economic aspects. It also provides advice for policy makers for framing rules and regulations for better corporate governance.

With a valuation of USD 672 billion and contributing to about 10% of GDP, the Indian retail industry has seen significant growth with some strong players entering the market. Although India has a low retail penetration compared to other countries like the United States, where it is 85%, the Indian economy is expected to grow 7.2% and 7.7% in FY18 and FY19, respectively, according to the International Monetary Fund (IMF). Private labels are those products or services that are provided by a company under another company’s brand. Although this concept of private labels is at an early stage with an estimated share of less than 7–8% of the retail sales of the organized sector, it is growing quickly. As far as the market for private labels is concerned, the category of food alone contributes 76% of the total sales.

In our research work, we have analyzed factors like price, store loyalty, store image, packaging, visibility and the kind of product that influence the purchase of private labels in the Indian market. Also, we investigated the strength of relationship, if any, between price, store loyalty, store image, packaging, visibility and the kind of product and purchase of private label products.

The Insolvency and Bankruptcy Code, 2016 (IBC) has been one of the most ground-breaking laws enacted in the country in recent times. It has already subsumed the existing Sick Industrial Companies Act (SICA), revamped the Debt Recovery Tribunals (DRT) and has emerged as a major legislation. Consequent to the implementation of IBC, there has been a paradigm shift in the debt-recovery scenario in India. Encompassing all companies, partnership firms and individuals, the code offers uniform, comprehensive insolvency legislation along with coherent and consistent provisions for the stakeholders affected by inability to pay debt or business failure. Unlike the time-consuming and never-ending process that used to be prevalent earlier, the code aims to attain time-bound and effective bankruptcy resolution. Now, the Insolvency and Bankruptcy Board of India (IBBI) has taken a pivotal role. This chapter analyses the IBC’s effectiveness in handling the situation that it was created for.

Safety and security are core needs of human beings. In modern democratic society, police are the legitimate designated authority performing this function and having monopoly over use of force. However, police cannot be effective without broad public support and cooperation. Perceptions of police efficacy matter as it is the most visible symbol of the state authority. Prior research shows that certain demographic characteristics such as age, gender, education, socioeconomic status, and so on impact citizens’ perceptions of police in much of the developed world. Indian Police are presently locked in a violent confrontation with left-wing extremists in the backward and tribal areas of the country. The poor and tribal youth are a primary recruiting target for the extremist ideology of armed rebellion against the state. Police need to wean youth away from violence and ensure greater public cooperation to succeed. This research aims to study the perceptions of youth about police in a heavily extremist affected area and how the demographic variables impact their attitudes towards cooperation with the police and acceptability of violence against the state.

Work rules are in a constant state of flux with new yardsticks by which employees are being evaluated. In the corporate world, it is increasingly being recognized that impressive curriculum vitae, good credentials and technical expertise do not have the desired impact in someone with low Emotional Intelligence (EI). The workplace is about people and relationships and an employee with high EI should be viewed as a valuable asset. The contribution of EI for individual success and specifically to success in the workplace is realized now. Intellectual intelligence contributes about 20% towards life success and the remaining 80% may be attributable to EI. EI is indeed significant in the workplace and is not only limited to it being a desirable quality in employees but also helps recruitment, predicting performance, negotiation, performance management and peer relationships. The present study is an honest attempt to measure EI and its dimensions in both male and female public bank employees.

Contemporary research on start-up firms primarily focuses on business growth and its contribution into the mainstream business economies. Research featuring leadership impact of business promotors on firm-level outcomes, particularly corporate entrepreneurship and firm innovativeness, have been unexplored. This is partially because the underlying mechanism remains largely unexplored in the context of start-ups. However, the way start-up promotors think is having an influence on firms’ strategies and outcomes. We examine how two distinct leadership styles, transformational and transactional, each influence firm innovativeness and corporate entrepreneurship. In our research, we propose that decentralization of decision-making and risk-taking ability of start-up promotors mediates the relationship between leadership style and firm innovativeness and corporate entrepreneurship. Using a sample of 109 start-ups registered under the government’s Startup India programme, we studied these relationships. Our results suggest that the transformational leadership style is strongly related to corporate entrepreneurship and influences firm innovativeness, whereas transactional leadership encourages centralized and risk-averse decision making.

Past data for Northeast India reveals imbalanced regional growth. However, the situation is changing. The eight states in the region have surpassed Indian average GSDP growth of 4.74 on 2004–2005 prices (updated 19 August 2015 by Ministry of Statistics and Programme Implementation, Govt. of India). The region has almost 30% tribal population (27.27%, according to the 2011 census). The growth of the region depends largely on tribal population. The present study discusses the benefits and disadvantages faced by tribal entrepreneurs in the last five years in four densely populated tribal districts of Northeast India. We interviewed more than 150 tribal entrepreneurs from East Khasi Hills and Ri-Bhoi in Meghalaya, Churachandpur in Manipur, and Aizawl in Mizoram. These districts have tribal populations of more than two lakhs and tribal population densities of more than 80%.

Employees are considered key sources of value creation in a firm, as they are the means for generating innovative ideas. Employee relationships are associated with compensation packages to minimize the adverse impact of low compensation on employee mobility in the knowledge-intensive organizations. Employees with extremely high performance are less likely to leave the firms that offer higher compensation than competitors. Firms offering relatively high compensation packages are able to retain talent and reduce inter-firm mobility. Hence, organizations actively participate in the development of talent teams to enhance strategic mobility networks around the world. The organizations follow digital sharing of knowledge at multiple and cross-cultural workstations to involve intra-organizational mobility of employees and induce creativity. Mobility (physical) of employees also provides opportunity to share knowledge through digital platforms with the parent organizations. This study is based on empirical analysis of five dimensions: employee knowledge, mobility, rewards, engagement and organizational creativity. The data collection is spread across three multi-national organizations operating in Mexico. This is a conceptual study, which aims at reviewing the previous studies and to develop a research model in reference to employee mobility, organizational creativity and knowledge-sharing process to measure organizational performance.

Social media has changed firms’ approach to business dynamics and consumer behavior. Consumer perception of products, services, brands, and firms are continuously being influenced by a bombardment of data and information being shared via social networking sites (SNSs). Consumer behavior is potentially swayed by the content and tone of the word-of-mouth occurring via social media; in fact, brand loyalty can be effectually persuaded, whilst consumption can be dissuaded. That said, could such ongoing communication influence consumer behavior towards the engagement of consumer activism? It is clear that SNSs are an exceedingly powerful channel of information that users as well as current and potential consumers have grown to trust. Further, they have gradually become a preferred source for information. Therefore, the objective of this study is to analyze the influence of social media word-of-mouth on persuasion and dissuasion of consumer behavior regarding firms’ business dynamics.

This chapter analyzes the relationship between the exports and the Gross Domestic Product (GDP) of Brazil, Russia, India, China and South Africa (BRICS). The purpose is to measure the cumulative average effect that the exports of these countries have had on their economic growth. At this point, the relationship between China and Brazil stands out, since the Asian giant’s exports to Brazil have contributed, to a greater extent than Brazil’s exports to China, to economic growth. Two estimation procedures are used for comparative purposes: a traditional VAR model and a Bayesian VAR model. This Bayesian approach offers superior goodness of fit.

In the past decade, social media use has dramatically expanded. According to recent estimations, by 2017 almost half of the worldwide population has at least one social media account. Recently, researchers have started to explore how consumers behave in this new digital environment and how that behavior is different from that in the physical world. This chapter reviews and organizes the academic literature on this topic. Authors then propose an integrative model that describes and helps explain how consumers behave and interact with brands on social media. Five themes are identified as the main consumer behavior factors in social media environments: (1) the motivators and (2) de-motivators for consumers to follow brands on social media, (3) the interactions that consumers have with brands on social media, (4) the effects of following brands on social media, and (5) interpersonal relationships as an important contextual element. Finally, the authors suggest areas of greatest potential for future exploration.

This chapter uses an Agent-Based Model (ABM) to perform simulated experiments on adoption of a reverse innovation under the influence of paid advertising messages and word of mouth. The main objective is analyze the adoption and diffusion of a reverse innovation across a developing country—the country in which a reverse innovation is first launched—to then analyze its further diffusion in a developed country. While most of literature on diffusion and adoption of innovation is focused on aggregated transversal studies, this chapter utilizes an ABM to analyze the phenomenon at the micro market level, that is, observable consumer decisions. As secondary data on sales of reverse innovations is almost unavailable, this study relies on an experimental design with different levels of paid advertising messages and word of mouth, network densities, and market sizes. Results show that a reverse innovation diffuses faster in a developing country and reaches a larger market segment than the diffusion in a developed country. Managers are called to enact an ambidextrous marketing strategy across countries and to expect differentiated diffusion patterns.

The goal of this chapter is to demonstrate empirically that relationship lending creates incentives for both banks and entrepreneurs to interact as lenders and borrowers. The discussion addresses the research questions of what happens (a) to the cost of credit as the relationship matures, (b) to the probability of default for the entrepreneurs as the relationship gets stronger, (c) to the probability of pledging collateral to the entrepreneurs and (d) to the value of the collateral as relationship increases. The empirical evidence suggests that relationship lending creates incentives, while facilitating monitoring and screening because it overcomes the information asymmetries and moral hazard problems that a transaction between lender and borrower carry. The empirical evidence is based on data acquired directly from a bank (Banorte) that lends to entrepreneurs.

This study examines the impact of corporate governance variables on non-performing loans of Nepalese commercial banks. The dependent variables are ratio of non-performing loan and cost efficiency. The independent variables are board size, independent directors, audit committee member, foreign ownership, domestic ownership, CEO duality, bank age, female director, board meeting and bank size. This study is based on secondary sources of data collected from 18 Nepalese commercial banks from 2010–2011 to 2015–2016, leading to 108 observations. The data were collected from annual reports and websites of the selected Nepalese commercial banks. The regression models are estimated to test the significance and impact of corporate governance variables on non-performing loans of Nepalese commercial banks.

This study examines the relationship between corporate governance and dividend policy of Nepalese enterprises. The dividend payout and dividend yield are the selected dependent variables. Firm size, liquidity, CEO duality, return on assets, foreign ownership, gender diversity on board, managerial ownership, institutional ownership and leverage are the independent variables. The study is based on 126 observations of 14 Nepalese commercial banks and seven insurance companies for the period of six years from 2010–2011 to 2015–2016. The data are collected from the annual reports of selected Nepalese commercial banks and insurance companies. The multiple regression models are performed to test the significance and impact of corporate governance on the dividend policy of Nepalese enterprises.

This study examines the impact of ownership structure and corporate governance on capital structure of Nepalese listed companies. It shows that board composition and CEO duality have a positive relationship with the capital structure of Nepalese companies indicating that higher the board composition and CEO duality, higher would be the leverage and long term debts to total assets. Likewise, women directors and number of board members have positive relationship with capital structure variables which reveals that higher the number of women directors and number of board members, higher would be the leverage and long term debts to total assets. The result also shows that institutional shareholding and managerial shareholding have positive relationship with capital structure variables. Similarly, size, age and return on assets also have positive relationship with capital structure variables. This indicates that higher the size, age and return on assets, higher would be the leverage and long term debts to total assets. However, board size has negative relationship with capital structure variables. This reveals that higher the board size, lower would be the leverage and long term debts. The regression result reveals that beta coefficients for board composition and women directors have positive and significant impact on capital structure of Nepalese listed companies. The result also shows the positive and significant impact of board meeting and managerial shareholding on capital structure. Likewise, firm size, age of the firm and return on assets also have positive and significant impact on capital structure of Nepalese listed companies.

This study examines the effect of board diversity and corporate governance structure on operating performance of Nepalese enterprises. The dependent variables are return on equity (ROE) and market price per share. The independent variables are CEO duality, outside directors, board diversity, board size, board meeting, audit committee, block shareholders, firm size and leverage. The study is based on 20 companies consisting of 10 banking and 10 insurance companies with 100 observations for the period of 2011–2012 to 2015–2016. We collected the data from banking and financial statistics and the Bank Supervision Report published by Nepal Rastra Bank, and the annual reports from the selected Nepalese enterprises. Multiple regression models are estimated to test the significance and importance of board diversity and corporate governance structure on operating performance of Nepalese enterprises.