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May 13, 2002 | 1420 IST
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'Employee is the most important stakeholder'

BS Corporate Bureau

The business community should realise that the most important stakeholder of a company is its employee and not its shareholder.

This was the essence of the two-day international conference on 'Legal reforms in infrastructure: The way ahead', jointly organised by the Confederation of Indian Industry and the Bar Association of India to focus on various issues, including the business and social responsibility of a company.

Former finance minister P Chidambaram and attorney-general Soli Sorabjee were among those who attended the session on business and responsibility.

Speaking on the occasion, Chidambaram said, "We often forget that we should first focus on the main stakeholders of the company, the employees and the customers. The business organisations, however, only try to satisfy their shareholders."

Business houses should try and optimise profit and not maximise profit, which might prove threatening, he added.

Reiterating the point, Sorabjee said the business community should give a "fair share of jobs to the underprivileged, including the Scheduled Castes and the Scheduled Tribes."

Sorabjee also said the business community should respect the fundamental rights of individuals.

They must not curtail the rights of their employees, and allow the trade unions to voice the opinions of the employees, he pointed out.

"The corporate world must be based on corporate democracy," he said.

At the same time, they must also consciously work towards bridging the gap between the haves and the have-nots.

The need of the hour was to protect certain sections of society, and the business community must join in the drive, he said.

Emphasising the need to protect the environment, he said most companies had been ignoring the environment and spreading pollution to increase profitability.

"It is the obligation of the entire business community to protect the environment, but most companies have been ignoring this to maximise profits," he said.

Sorabjee said the business community should try and generate employment as well as ensure continuous increase of income.

"This will help business houses to be long-term players," he said. Chidambaram said the idea of corporate governance was yet to be instilled in the country.

More jobs had to be created for India to become a free economy, he added.

The former minister also observed that scams had spoilt the image of Indian business. "The business community must list its social responsibilities and inculcate them as responsible corporates," he said.

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