The End of Innocence

Greed was always omnipresent. What worries me is that it has permeated places that I thought unassailable. Like the middle class which always placed a premium on Goddess Saraswati over all else.

Haresh Chawla

[Image by Gerd Altmann under Creative Commons]

The main thing about money, Bud, is that it makes you do things you don't want to do ~ Lou Mannheim in the Hollywood classic Wall Street

It was early 2008—a few months before the world tried to come to an end. The Global Financial Crisis would hit us in September that year. I was sitting across a bunch of young, bright-eyed NRI kids from the UK. They had left their cushy jobs in London and wanted to launch a mobile gaming venture in India. OnMobile had just listed and was running amok on the bourses. The market was red hot for mobile start-ups—Altruist, Comviva, 197 (PayTM’s original business), all of them were the next big things. Caller-tunes and value added services (VAS) had become money-spinners overnight. 

Fresh-faced and full of optimism, they went on about how mobile gaming in India would be the next big thing after Google. The energy was infectious. I asked them how much money do they intend to raise. “Rs 20 crore,” they said without as much as blinking an eyelid.

It was a lot of money in those days. I asked them to show me how they planned to deploy it. They pulled their spreadsheets out. 

My eyes latched to an expense of Rs 5 crore under “Miscellaneous”. What was that all about? “What do you mean by parking such a huge amount under miscellaneous?” I asked them. 

They looked at each other—and then at me. “Sir, this is money kept aside for the under-the-table amounts we need to pay VAS teams at some of the Cellular operators. We figured at the circle-level (telecom players run profit and loss statements circle-wise) they have made a rate card for running promotions and charge us under-the-table for every game downloaded. If we don’t pay it, we’ll never be successful. It is standard industry practice.”

I declined to invest. The conversation though stayed in my head.

Every week we hear of stories of fraud at some corporate. And mind you, those are stories that come out in the open. We really don’t know how many frauds go unnoticed or get shoved under the carpet because it looks silly for a company to be scammed by its employees.

A few weeks ago we read a compelling account of fraud at Foodpanda. In the recent past, we’ve heard of misdemeanors from Reebok to Ranbaxy. A study by Assocham in association with Grant Thornton concluded 71 percent of companies surveyed expected cases of corporate fraud to increase in the next five years. “Bribery, corruption and regulatory noncompliance are the top frauds that respondents have experienced in the past two years,” it said. 

Global corporates are not far behind. What happened at Volkswagen was not negligence or oversight. It was deliberate deception—not by one man, but perhaps ordered in the boardroom by a leadership that instructed a team to write software to hoodwink the pollution testing system.

When I think of it, there isn’t anything here that ought to surprise us. Greed inevitably lurks in places where people have discretion or arbitrary power. It started with food when primitive man snatched it from another for survival. The advent of money just made it easier. No one ever said, “Enough, I don’t want to make my next million.”

Every society has tried to fight this addiction. Every religion condemns it. From Red Riding Hood to the Mahabharata we’ve seen the greedy one lose. The moral of all these stories is that retribution follows greed.

In India, we are no strangers to greed. We don’t need international rankings to know how corrupt we are as a nation.

When I think of it, greed happens at four levels.

The first kind of greed is witnessed among politicians and high-ranking government officials. Across the world, they are among the most corrupt. You can almost forgive them because this behaviour is a pre-requisite for the job. After all, how can the world’s armies move if defense contractors stopped their machinations?

The second kind of greed exists in the form of corruption at the corporate level where greed becomes a game between competitors. Who can get ahead with which licence first? We see unholy alliances between Indian conglomerates and politicians. We saw it in the financial scams of Harshad Mehta and Ketan Parekh. We see it in the financial engineering by folks who snare investors into their chit funds. Most of these people have money to last generations. But it is a drug. These people are greedy because they get a thrill out of winning. They were not brought up to be criminals. Their cleverness drove them to it. 

The third kind of greed is that of the policeman, the court clerk and the government servant. This is where India starts becoming a case study for the world. Their greed cannot be condoned. But we can attempt to understand it.

They are witnesses to life pass them by in the post-liberalization era. Private sector incomes and lifestyles have transformed and these people are left behind. They watch as others go by in BMWs and Audis and buy apartments that run into the crores. Sure, they have the security a government job provides. But they don’t have the income to maintain the lifestyle they see around them. It is inevitable then they rationalize it is okay to take a cut.

The fourth kind of greed now emerging is that of the well-paid, well-educated, Indian manager with roots in the middle class. They’ve worked their way to the top and it isn’t difficult to spot those paid by the crores every year. Theirs is not greed of want—it is greed born of desire.

Until it came to this pass, they worshipped Saraswati, the goddess of learning. They believed if they did the right things, Laxmi, the goddess of wealth would shower their blessings on them. They were the ones who prayed before every auspicious occasion. They believed in doing things the old fashioned way. Work hard, and the rewards will follow.

But their coming into wealth on the back of fancy salaries seems to have unhinged them. They dream of a bigger house, a bigger car, a bigger everything that compels them to take shortcuts and compromise on integrity. To understand the import of that, allow me to point to a report published in The Times of India on how income inequality has doubled over the last 20 years.  “The top 10 percent of wage earners now make 12 times more than the bottom 10 percent, up from a ratio of six in the 1990s,” it says.

If more perspective is needed, do look up this interesting thread on Quora around what is your salary at age 24 in India.

Is that the driving force behind shorter tenures at work? Does that explain the desire to quit for a marginally higher salary?

A great example to look at to understand this new kind of greed: the conversations Rajat Gupta had, which were eventually used as evidence in the insider-trading case for which he got convicted. That desire to get a board position and earn a few extra million dollars was as clear as daylight. The evidence was secondary. The greed was apparent. Rajat Gupta is the poster child of the middle class dream—a story of rising from hard circumstances, individual grit and impeccable ethics. But then it comes to naught for a few million dollars.

For the life of me I haven’t figured why couldn’t he understand money is only a marker of what you create and achieve. Money is meant to be the outcome of a good job. It was to be but an accessory to success. But the means have become an end in itself.

Scientists researching the theme have consistently observed becoming rich could make you greedier. Chances are the better off you are, the more unethical you are likely to be. They found the richer you are, higher the chances you will break traffic lights, threaten pedestrians, lie on your job interview and generally cheat at a game. Somehow apathy follows wealth, which follows greed. 

Or is it nothing more than peer pressure? The desire to shop the best, vacation the hardest, send your kids to the most expensive schools and universities. Are we being compelled by social media that pummels our feed with the best one percent of other people’s lives and makes us believe our own is insipid? Does that dictate our aspirations and actions? Do we need a reminder that we are not what we own, and are not defined by our bank balance?

And no one knows when this disease strikes a working professional. I don’t think their spouses and families know when these people choose to forsake their reputation for money. When do they take that first, fatal irreversible step?

Our moral compass was to point towards True North. But that needle now wavers. It points towards more

Was this article useful? Sign up for our daily newsletter below


Login to comment

Sachin M on Jul 30, 2016 5:53 p.m. said

For the first time I found your article written <b>without</b> deeper analysis.. If I am sounding harsh critic, let it be. I mean it.
There is sense in your article that people from middle class are different than others as you seem to be very disturbed by their acts of corruption. You shave condoned corrupt acts of politicians,corporate and also of Clerks...
Z) Did you analyze how many people whose fathers/mothers were clerks, policemen before (all those who you condone for corruption) are now in middle class and thus working in companies ? Have they learn something from their parents ?
Y) If people who are aspiring to be part of corporate group learn tricks (which you seem to condone too) why fuss ? I mean are they not getting fit for jobs ?
X) Have you analyzed something from perspective of work ethics ? How blazing BMWs can be reason for condoning corrupt acts of clerks ? if that can be why can't it be for Middle class ? Those who are earning crores in salary are vouching for top level and those in lakhs see real estate brokers getting AUDIS
W) Have you analyzed perspective of reward system and punishment on middle class ? Many people slug it out and still see that someone is sitting next to them in best college by getting half marks and is also getting fees waived off . They will also see no Punishment for those who indulge in corrupt practices.
V) Have you analyzed the effect of popular awards given by corporate system and corruption involved there ?
and How a culture is bred and is made ? Nothing of that sort and so found your article just trying to put onus of honesty on middle class.

nihar mamtura on Dec 14, 2015 5:34 p.m. said

It's indeed sad that our society's moral compass has completely lost its direction. Taking short cuts is a way of life for the well heeled and the so called well educated people as well. I have heard accounts of cheating in exams by MBA students of well known colleges. So you can imagine where the rot starts for corporate India.
Simple things like signals on roads, stcking by rules while driving is not followed by educated classes as much as the other less fortunate ones.
I think we can't change for another couple of generations. Children of today see their parents' flouting rules, can you expect them to become model citizens?

Saurabh Chakrabarti on Nov 03, 2015 8:19 a.m. said

Dear Haresh,

Your article is brilliant, very timely and rings a lot of bells. I have worked in a Telecom company as well as in a VAS company earlier in my career ( the heydays of telecom, actually) and have seen much of all that you have written, from very close quarters. It was a common knowledge among my peer group as to who was getting paid, how much and from whom. It was almost institutionalised as a practise and very rampant across companies and suppliers. But the point I want to make is different. I feel that the we run the risk of simplifying the issue if we say that it just an erosion of personal principles or values. At a certain level, it is of course that. But my take is that there are some more influencing factors at play here. I think, there is a very stark lack of quality leaders in today's corporate world. We clearly lack leaders who are highly ethical, principled, clean, upright and set very high standards for themselves and for their teams and colleagues. We have very few senior leaders or managers who take time out to 'mentor' and 'coach' their team members who, fresh out of B-school or finishing their studies, face the hard and competitive and demanding corporate life. How many managers and leaders teach you essential 'life skills' and 'lead by example'? Very few, actually. A case in point, I was forwarded the link to your article by a very senior level corporate manager, who I worked with at the start of my career. He was a true mentor and a person who shaped me a lot during my formative years in corporate life. His sense of values and numerous examples of exhibiting exceptional professional behaviour in face of severe 'temptations' and 'provocations' as well as teaching all of us the 'dos and the donts' have immensely helped me in my career. More importantly, they have stayed with me and have held me in good stead over the years. That 'training' surely helps along with managing P&L accounts of your business.

Here's hoping that your article will help some leaders or people-managers reach out to their colleagues and team-members to 'fix' their 'moral compass' and that will really be a 'job well done' in the end.

Thanks again.

Saurabh Chakrabarti

Haresh Chawla on Nov 02, 2015 11:11 a.m. said


The circle of life and eventual decay is something we study in Hindu scriptures. The lament here is that we are seeing an acceleration of decay in just one generation and in people who you never thought would stoop.

Haresh Chawla on Nov 02, 2015 11:08 a.m. said


Agreed - I think it takes place due to lack of oversight and possibly when they see their peers do it. Some may even be propelled by corrupt suppliers and vendors who cajole them into taking that first step.

As far as the next generation goes - actually I am more hopeful - they seem to be more focused and self-aware. The generation I talk about is ours - the transition generation - which has seen a resetting of lifestyle expectations and has to cope with them. That won't be the case with the next one - the next 20 years will cause a lesser upheaval than the previous 20!

Haresh Chawla on Nov 02, 2015 11:04 a.m. said


I think it's very difficult to pull someone back - unless one has taken the step in haste and is suffering a conscience attack. Else it is usually a drug - and more so when you realise how easy it is - since most people around you trust you blindly given a professionals credentials. Technology can only help you notice the exceptions - but as they say - a human being will always find a way to fool technology!

Adam Steele on Oct 31, 2015 7:59 a.m. said

There's a millenia old thought on this. I've just draped it with modern language here.

The pursuit of Wealth, Knowledge and Freedom is inherently the objective of all living beings. This is inclusive of everyone who dies having lived, whether animal, insect, human being. Their perception of wealth in the form that most pleases them dictates their motivations. Motivations naturally lead to actions and thereon to consequences and results.
Armed with this knowledge of converting Knowledge to Wealth, every being is faced with a set of routes and sequences that they must choose from. Whatever they choose, they'll pass through stages of inception, elevation, greatness, plateau and decay. This is natural.

Ethics, Philosophy, Sciences, Legality, in fact the entire realm of what is called Knowledge are means to an end. Everyone has choice in which knowledge they adopt as their own, which they most feel comfortable with, which transitions they most wish to bring.
Not one has the choice of not having achieved the last of these, Freedom. Everyone reaches that end.

Whether they reach it through having advanced their respective perceptions of wealth, knowledge & freedom or by simply living through to the ends of their respective lives.
Everyone achieves their ends.

Alhad Pofali on Oct 30, 2015 4:24 a.m. said

About the fourth kind, I think somewhere they know that slowly they have crossed over to something that they were not fundamentally to begin with. It is the mindset of entitlement that gets exhibited in the day to day behavior. The challenge is that the next generation is born in this environment....

Sudipto Patra on Oct 27, 2015 2:19 p.m. said

absolutely! but how to bring someone who has already crossed the rubicon back? how to discourage others from crossing over? can we establish the fungibility of good behaviour and long-term economic benefit to encourage a value-based society? can technology help each one of us develop the necessary personal internal moral compass?

About the author

Haresh Chawla
Haresh Chawla


True North (formerly India Value Fund)

Haresh Chawla is currently a Partner at True North (formerly India Value Fund Advisors). True North is one of India's most experienced and respected private equity funds, with over $1.5 billion under management. At True North, he focuses on investments in the food and consumer sectors where he identifies and helps transform mid-size businesses.

He is best known though for his leadership in transforming the Network18 Group into a formidable media network. Under his watch as Founding CEO, Network 18 became India's fastest growing Media and Entertainment network.

In his dual leadership roles at Network18 and Viacom18, he built a media conglomerate that reached over 300 million households across platforms including television, print, films, mobile and internet.

His career at Network18 spanned 12 years, and he grew revenues from $3 million in 1999 to $500 million in 2012. He transformed the company from a TV production house to India's leading multi-media house with over 11 TV channels including Colors, CNBC-TV18, CNN IBN, MTV India and Nick India. He forged joint ventures and long-term partnerships with the world's largest media companies including NBC (Comcast), CNN, Viacom, Forbes, A&E Networks.

Haresh has also been keenly engaged in the consumer internet revolution in India from the early nineties. He is credited with building India's largest most well-known internet businesses like Moneycontrol, Bookmyshow, Yatra, Firstpost and Homeshop18. He continues as a successful investor and mentor to several internet and consumer start-ups today.

Earlier, Haresh has been part of founding teams at the HCL Comnet; ABCL, where he set up the Film Distribution Business, and at the Times of India Group where he launched Times Music.
Haresh holds a Bachelor's degree in Engineering from IIT Bombay and a Master's degree in Business Management from IIM Calcutta. He lives with his wife and two children in Mumbai.

Also by me

You might also like