I hope covid gives us a break and asks us what kind of business we want to build: Indra Nooyi
NEW DELHI : Indra Nooyi was the first woman of color to run a Fortune 50 company. It was not an easy race. Former PepsiCo CEO shares how she did it in her new book, My whole life. The book, however, is more than a memoir. It raises questions about workplace behavior, inclusion and the role of business in society. Nooyi spoke to Mint:
How was the book born?
When I left my job as CEO of PepsiCo, everyone asked me why I hadn’t been replaced by a woman. They never ask this question of men. I realized that I had trained a lot of people to climb the ranks to become CEOs. Many women stayed in the middle ranks – they went to smaller companies as CEOs, not wanting to stay in the brutal selection process (at PepsiCo). But I also realized that the number of women moving up through the ranks was limited because the challenges of having families and working were just too great. The more I started to study it, the more I realized that the only way to keep these extremely smart and highly productive professionals in the workforce was to provide them with a support system. I thought I would write a series of articles on this topic. Several editors have said that people are interested in reading my story. But I didn’t want to write from memory. This book has my story as a backbone but also the lessons that have flowed from it. That’s why it’s not a revealing book or a book with incidents that make people uncomfortable. The book explains what needs to happen in order for women to engage in paid work if they so choose.
The book focuses a lot on inclusion and prejudice. How do you deal with implicit prejudices in the workplace?
This is probably the most difficult question. We have to start by saying that this is an economic argument. We want the best and brightest in the economy to work for us – the only way businesses and institutions can thrive is by bringing in the best and brightest. It’s good for society, for businesses, for shareholders. Leaders must learn to think for the best of the company. For me the tone at the top is very important. When leaders detect bad behavior, immediately kill it in the bud. Second, if you don’t have the numbers — enough diverse people — you will never be able to put a program in place. You need to take artificial steps to increase the number and then put in place the right inclusion program. At the end of the day, we are all in a war for talent and we have no choice but to create inclusive workplaces. People who practice non-inclusive behavior need to put themselves in the shoes they are discriminating against. How would you like to be treated that way? We can come with implicit prejudices, but life has to change.
You pointed out that what is good for business and what is good for society must go hand in hand. Businesses and boards are talking about it, but do investors realize it matters?
The idea that a business is connected to the community is not new. This was the original foundation of the limited liability company. I believe that the idea that companies are embedded in society is at the heart of how society and the economy work. It is indisputable. Investors and businesses have moved away from this idea in recent years due to an excessive focus on the short term. This was facilitated and diminished by the ease of negotiation. The marginal investor set the tone for everything. You had 24/7 media amplifying all kinds of stories. Very often, the titles and the stories were completely unrelated. Very often people didn’t read the story and just read the headlines to make decisions. He encouraged the type of “make money fast” behavior that caused an investment habit that was not conducive to companies setting up long-term businesses. Here’s an example: If a company says they can source their product in country X at a much lower cost, everyone is happy. But if this country employs child labor or employs its workforce very badly or makes them work are inhumane conditions, are you okay? When we talk about what is good for the company, we pass it off as an action that destroys value or an action that will affect profits in the short term. No. It’s about running a business that doesn’t steal Peter to pay Paul; it is about running a business that does not destroy one company to make another company prosper; it is about thinking of companies as engines of growth, engines of economic development in a positive rather than a destructive way. This thought was diverted for a while, but it returned to the mainstream. Investors are increasingly realizing that they need to focus on environmental issues, for example.
What role did covid play in this philosophy of sustainable capitalism?
Covid has been a red flag in some ways. I don’t believe Covid has done much about sustainable capitalism although it should have. What this has shown us is that we are all connected. I hope this will prompt executives and companies to reassess their priorities. Let me tell you where the covid should have forced us to think about sustainable capitalism. Should mutuals have made the reimbursement process more flexible during the covid? The answer is yes, but many have not. Should suppliers have significantly increased the prices of their products thanks to covid? In a free market system, the answer is yes. But was it okay to do it by covid? These are the kinds of questions we should be asking ourselves. This is where we have to form another kind of capitalism, capitalism with humanity. The other example is that many nurses and frontline workers did not have the option to work flexibly or remotely. They had to be in the workplace. They all suffered from the lack of childcare facilities; they didn’t know how to run the household. How many companies have stepped in to help? We cannot make society grow on the backs of underpaid and badly treated workers. I hope the covid will make us all pause and wonder what kind of business we want to build. The last point I’ll make is that covid has had a disproportionate impact on people with co-morbidities. Co-morbidities are due to the way people live, drink, the environment. We have to start talking about the environment in profoundly different ways. We need to make our people healthier.
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