In the following interview, we had a chance to catch up with Mr. Girish Kumar RR, Group Head Ethics & Integrity, GMR Group. Based in New Delhi, India, the GMR Group has been developing projects in high growth areas such as Airports, Energy, Transportation and Urban Infrastructure. The Group is also actively engaged in the areas of Education, Health and Hygiene, Community Development and Empowerment through its Foundation, reaffirming its grass root presence as a change agent of society in the field of Corporate Social Responsibility. More on the GMR Group here.

In this conversation, Mr. Kumar discussed the belief system at GMR and how the company’s ethics programs are aligned to ensure a greater degree of coherence between new hires and the middle managers.

SKP Group: Sir, I just wanted to understand broadly from the GMR as a broad group, there is a lot of, there are lot of businesses that are there, that fall under the broader GMR umbrella and it also has a number of nuances that exist. When driving ethics and compliance for a group like this, how does it work and what are things that you normally do, internally?

Mr. Kumar: Broadly we do two things. One is when we want a particular outcome that we want GMR to be known as an ethical company, the outcome is driven by the actions of the employees. Actions of the employees, in turn, is also generated by the, what type of behavior they exhibit when they deal with vendors, suppliers, customers and other stakeholders. The behavior, in turn, depends on the internal belief system of the employees. So it is the beliefs which drive the behavior, behavior in turn, will drive action, action will lead to outcomes. So whenever we want to make GMR an ethical company, we must ensure that the belief system of employees is in alignment with the values and beliefs of the GMR group. So one side, so, we address our ethics function, ethics awareness program. We address this ethics awareness programs to ensure that employee behavior is aligned with our values and beliefs.

The belief system of the organization. So we have to find out how far the employees' belief system is alignment and if there are any gaps are there if their belief system is different? Then which are those employee segments where that belief system is different? Ensure that appropriate action is taken to see that they are in alignment. So we have our ethical culture survey program, we have ethics barometer program and we have our own ethics council meetings, all these initiatives we do take, apart from our whistleblower program and all those routine programs to see how exactly employees are conducting, the stakeholders and this one. That is one part of it and we know that most important is while the top management is always any, in any organization have a great vision and all that, it is the middle management, which is seen by the lower end employees.

It is the middle management, which represents the what top management desires or the board desires. So we focus on ensuring the middle managers, they are in alignment, because the junior employees when they look up when they think of the top management, the immediate supervisor how he behaves even in today's this one, how is the supervisor? Is he in alignment with our groups values and beliefs? So we focus on ensuring that the middle managers are in alignment, once they are brought on to the system and alignment, they, in turn, they will see that the people who are working under them also in alignment. So on one part of our ethics and compliance is to see that the middle managers and secondly the new entrants, new hires, who are just joining, because in GMR people join from different organizations and with a different cultural background...

SKP Group: Not necessarily they come from the same culture.

Mr. Kumar: They come from the same background and they have come from different universities, sometimes different organizations. So, first of all, we focus on the new employees who are joining the organization to see that they understand our culture, they understand our own values and beliefs. Secondly, we focus on the middle managers because they represent, the employees look up on the middle managers as their role models. If the immediate supervisor is wrong, no matter what the top manager says the employee is bound to follow what the supervisor says, rather than what the top management says.

So our ethics programs are aligned to ensure a greater degree of coherence between new hires and the middle managers to values and beliefs. The second part of the course is enforcement. We give a lot of preference there, compliance part in there, to see that if people are not adhering to the rules, adhering to the code of conduct or if there are any violations, how quickly management will come to know about it and will respond to it.

The general perception in corporate sector is, it takes almost 24 months for some violation to come known, detected and action taken and it will be too late. So we make sure that time is as short as possible. That is, employee should feel that if he commits some violation, management will come to know about it early, and also action is also taken. So the responsive part of compliance is very strong in GMR, that means employees, as you know employees look at it from the point of reward and punishment, let us say, the punishment side, if they feel that, the punishment side means, risk of detection is high, of violation and risk of punishment is high then no matter what reward he would have got by violation, it looks that it will not match.

SKP Group: So basically attacking the economics?

Mr. Kumar:Yeah. We attack because in general, in general, if you have 100 employees, no matter whether it is a corporate or public servant and all that, in general what we found is 10 to 15 percent of employees are honest, whatever might be the systems. How weak or how good their bond, they are, they are, they don't violate. There are 10 to 15 percent are likely to [crosstalk 00:06:14] fight violations, how strong might be the systems. There are bulk of 50 to 60 percent of the employees who are in this one, they look at things in terms of

Mr. Kumar: What are the opportunities, rewards and risks and all that. So in case your process are, compliance processes are strong, in case your detection and response mechanism is strong, you are sure that the...50 percent of the people will find it unattractive to commit any violation at all. The remaining 10 percent of the hardcore people, the only way to take disciplinary action against them and see that they are out of the system.

So this is broadly, we follow a system to see that employees and compliances are kept in the highest.

SKP Group: You actually mentioned about couple of points in terms of ethics surveys and ethics barometers as part of your first point. What do you do as part of this?

Mr. Kumar: The ethics barometer is sort of, all employees, whether we admit or not when you have to speak up something, you have a dilemma, whether it leads to retaliation or it leads to some unpleasant situation or if you take a decision, it may delay the project and management may not be happy with it. So when you think of ethics and compliance, there is always a dilemma whether what he is doing, maybe in the short term, it may impact the business or it may impact his personal performance or personal goals. It might help the long run, but in short term, maybe during the current year his performance might be affected. Somebody may look upon, the supervisor may look at it in a different way. Ethics is always accompanied with a dilemma, dilemma of doing good vs dilemma of something..

Mr. Kumar: Else happening to him and all that. So, we conduct this ethics barometer based on our case studies, whenever we do inquiries, for a period of time, we see what type of violations are committed and why they are committed. We make them into case studies. Those case studies are put in sort of a dilemma form and see how employees respond to those when such situations are there.

SKP Group: Is this more as a workshop?

Mr. Kumar: No, this we conduct across organization before their PMP. Normally, before an employee signs of his performance in this one, he has to take this test and he has to pass in the test, that means each has being given 20 scenarios. An employee, in these 20 scenarios how he responds to a particular dilemma or whether his behavior is in alignment what GMR expects is evaluated. So in case he fails, he has to give in the test otherwise we will again conduct ethics awareness program to him so that he falls into the line.

SKP Group: Is it compulsory for people to adopt before they close their performance management cycle?

Mr. Kumar: Yeah, it is compulsory. Yeah, yeah, it is part of this one. The ethical culture survey, we measure in terms of transparency, leadership and are is the management giving them resources adequate to be ethical.

Are there pressure points? we may say be ethical. But if the supervisor says to do it in my way and not in him or way, so how do you do it? So feasibility, are we providing feasibility to the employee or is management maybe talking of high principles? Are they in alignment, what they are doing, this one, on the, do they, how the response levels are there? How the employees look upon the response levels of management and something is reported. We broadly measure employee’s response on seven parameters transparency, feasibility, adapt...employee, how response of the organizations to the violations and all that and then we get a score, we prepare ethics culture index, we prepare across this one. Then based on that again we evolve our remedial action.

In cases where some department or a segment of people have a lower perception on a particular matter, how to address those issues, we take action. So ethics culture survey acts as some sort of a response to that on the critical parameters of ethical culture and action, what action is required across the group.

SKP Group: Different businesses will have different dimensions. How do you actually differentiate those and how do you actually pursue those, within GMR itself?

Mr. Kumar: No, no matter whatever distance in the businesses and all, we can't have an unethical culture in airport sector, one type of ethical structure in power sector, one is for highways and all that. We are trying to, ethics is something common bedrock for the entire organization. Basic this one, the business models may be different, business processes can be different, but ethics is common. Is what should drive entire our business, so that's why, we tried to evolve as per as process concerned, particularly those concerning to award of contract, or those, which are related to other contractors and other vendors and all that. As far as possible there is a great degree of this one, uniformity in that. These things we don't, this one, this is common accepted program for the entire group. Also, not differentiated. We don't have that type of system. We try to drive a common ethical culture across all businesses, which is acceptable to us.

SKP Group: One of the other pieces that I wanted to understand is, when you actually mentioned, you mentioned about contracts, contractors and bids, so these contractors and contracts there will be a number of third parties that are involved in multiple businesses and there could be different kind of challenges that are there. Now ethical compliance is not limited to the point of how it happens within the organization it also extends to how the partners deal with it effectively. I just want to hear from you, what are you doing in that particular area and what nuances that you have evolved in those segments?

Mr. Kumar: Through our ethics helpline, our whistleblower program is basically meant for our employees, we are not limiting to those our employees only, even our vendors, stakeholders, also make use of those ethics helpline. We have a large number of, we have at least a couple of cases where employees of our vendors when they have a grievance against their management, they are raising a concern with us.

SKP Group: So the awareness is deep to that extent.

Mr. Kumar: They are raising the awareness. We are not just saying it is not our business, because if there is tomorrow any third party

Any violation is there, it again reflects on us. I can quote one, very interesting case, one of our vendors in our airport, their employees raised a concern that one of their employees has fallen sick and the management, the supervisor has not taken immediate action, when somebody has fallen sick and all in the airport. So though the, he happens to be an employee of the vendor but we have to, such concerns when they are raised to us we are ensuring that that concern is addressed to our HR again to see that why such a thing is not happening. Our one of our employee said he has resigned, his salary is not being paid by the vendor or some issues are there, right some issues are there, so we are, it is between the vendor and the employee but we, but it is reported on our whistleblower mechanism, we are

We are taking the initiative to see that such a resolution or that is one thing. Of course, the other part we have a problem, whenever any vendor or any supplier is there, it is a process of due diligence is there, the process of verification of the many incidents and then whether they have. We have what is called supplier code of conduct in GMR, so the, all suppliers and people who do the business with us they are supposed to sign it and then abide by it. It is a very comprehensive code of conduct. It is as comprehensive as our business code of conduct.

SKP Group: Is it different from the business code of conduct?

Mr. Kumar: It is different in the sense that it also speaks about their social responsibilities, environmental protection, and all those aspects also. I mean, we expect...

Yeah, third parties, for example. Not just matter related to only integrity, integrity is defined in a much broader manner. So there are other issues, how they do their business and all that and also GMR has this one, in case we have any issues related to doing we or we have a process to verify, whether they are following those systems or not. So everything is included, so all employ, so these vendors are supposed to sign it and then were required we monitor those.

SKP Group: Very nice. One of the other things that I wanted to touch upon was that you mentioned during the conversation one key point that you do is to take actions, to, taking actions are what you do or you also extend it to further things of demonstrating the action, show or publicizing the action within the system. Is that something that you do?

Mr. Kumar: Yeah, that is, in fact, that is a very important component of any action, because what is, we call it a ripple effect. If, even if you take action against one person, if the entire group is aware that a particular behavior has led to a particular action, then they would know what management is expected and what management stands for and all that. So whenever any termination or any action is taken, whenever, in fact whenever we feel, it can be as simple as misuse of vehicle or it can be corruption, need not be, even if a simple thing like misuse of vehicle takes place and we found that people this one, immediately a circular is sent that this is not what we expect them to do it.

So the employees are aware of what is happening this one. So, we do believe in communicating with employees whenever any violation has come to notice and wherever the action is taken, we would like to keep them informed so that employees are aware as to what management expects of them.

SKP Group: Another piece, which is relevant to this particular context is when we actually speak about ethics right, it is normally seen as some rogue employee doing something wrong, right. But there is a layer of supervisory lapses that normally exists in many of these frauds. It is not to say the supervisors were involved in the ethics violation, but there were lapses in the whole scheme. How do you actually deal with that? How do you fix up that responsibility on those supervisors?

Mr. Kumar: Yeah, it's a very important component of our work also. In fact, whenever we conduct any inquiry, the employee himself might have committed any violation, but we also see whether the supervisor has exercised, what type of oversight he has exercised? Whether there is any negligence on the part of the supervisor? Whether there are any lapses or omissions on the part of the supervisor? So along with action against the employee concerned, we also look at it, what type of process gaps have led to that type of violation. And in case, the process gaps involve lack of proper oversight by the supervisor or negligence on the part of the supervisor, action also is taken against the supervisor, even at the time of his PMP also. So we have two things distinctly, one is person who has committed it and then what are the contributing factors for that. If it is mainly a process violation then we will see that the process is improved. If there is a supervisory lapse are also there, whatever might be the supervisors, we initiate appropriate action against the supervisor.

SKP Group: So sometimes what happens is the supervisory violations are not very visible for example, it may so happen that, the, you are not able to fix a responsibility on a supervisor due to the nature of the case or the insignificance of the issue we are speaking about, or it may so happen that there is a trend of number of cases coming in that same particular area and there is action being taken at the employee level. Do you actually go forward and then take action basis those trends or advice basis those trends, to the management, to either council, the supervisor or to do any particular training for the supervisor for them to act more responsibly?

Mr. Kumar: Yeah, naturally if a large number of violations happen in a particular department or in a particular time frame, we cannot absolve the supervisor completely. So it is a certain trigger point for us to look at what the supervisor is doing, certainly, we have to ensure that appropriate action based on the nature of his responsibility or role and all that, appropriate action is taken. Certainly we, it is a very important parameter, whenever we look at it, how many violations are taking place or in what duration from violation to violation and how many employees are involved in the same department. It does happen occasionally like that, then certainly the supervisor will be on our radar. How effective he is, maybe he is delivering results, but there may be some other areas where he is falling short. We take action.