The Tatas: When Virtue Works

Why are the Tatas so much less corrupt than their contemporaries? How is their conglomerate still intact after five generations? The answer to an Asian conglomerate mystery, and Part 13 of the Asian conglomerate series.

Note: This is Part 13 in a series of articles and cases on Asian Conglomerates. Read Part 12 here. You may read more about the Asian Conglomerate Series here, or view all the published cases here.

We last looked at the Tatas — India’s preeminent business family — in Part 10 of the Asian Conglomerate Series, The Origin of the Tatas.

In that essay, I described the biggest mystery that leapt out at me when studying the conglomerate:

There is much to say about the Tata group, and there is much that is unique about their business structure. At this point in the Asian Conglomerate series we know why corruption exists wherever weak institutions, regulation, and the pressures of competitive arbitrage exist. To my mind, the most interesting question about the Tatas is this: how did they get by with so little corruption?

The answer to this question is both an accident of history, as well as remnants of the personal values of Jamshetji Tata,