We don't want conflict in family: R S Agarwal

Interview with Founder, promoter, Emami

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R S Agarwal, founder-promoter, Emami, responds to questions from Viveat Susan Pinto & Arindam Majumder on succession planning initiated by him and co-founder R S Goenka. Edited excerpts:

Why did you opt to do away with an earlier-constituted advisory board of professionals, for one made up of family members on succession planning?

We still have the leading lights of India Inc working with us. Barring A G Krisnamurthy (adman and esrtwhile Mudra founder-chairman), most of the other professionals, including Alyque Padamsee (ad guru), J N Godbole (former IDBI Bank CMD), K N Memani (former chairman and managing parner of E&Y) and N G Khaitan (solicitor) continue to advise us.

This is not so much on succession planning as much as it is on overall management of the group. We need advice from industry captains on how to steer the group and that is what they do in an advisory capacity.

But, why family members now?

We thought nominating one or two family members would not be in the spirit we wished to foster at Emami. Our working relationship so far has been so smooth and convenient that we did not want to destabilise it in any way. Both R S Goenka and me have worked as a family. By nominating one or two family members, we did not want to create differences in the family.

Would you not have to groom a successor at some stage? How long can this status quo continue?

I cannot disclose what our future plan of action is on that front.

Is your cautious approach linked to the discord and conflict in a number of family-run businesses today over succession planning?

Yes, it is true. The legal wrangles and conflicts in a number of family-run businesses are visible to one and all. We did not want to create this confusion and conflict in our family. Hence, the decision to set up an advisory board of family members. This is the first of a series of measures that we will take as we go forward. I cannot disclose anything more.

Among family-run businesses, there appear to be two schools of thought. One that believes in minimal involvement of promoter families in day-to-day operations like Dabur, and the other like Godrej where family members are involved in day-to-day operations. I don't see why family members should not be involved. We are as much a professionally managed group as one that is run by professionals. All my family members are professionally qualified and trained.

How you chose to run a company is a call that you take. It varies from company to company. We have a mix of professionals and family members running operations of Emami. We also have external agencies and advisors guiding us. This is something that works for us.

How do you react to speculation that your son, Harsh, is a likely contender for chairman's position once you retire?

I do not want to get into that. Who from the Agarwals or Goenkas will be appointed to which position and when is something I do not want to get into. At the moment, both me and R S Goenka are joint chairmen. That is how it stands at the moment.