The private sector must do its bit for social justice

Post-liberalisation, public employment has been shrinking. The government has been gradually giving up powers it enjoyed during the licence-permit raj, so it needed far fewer people to enforce them. It is also using technology to reduce manpower like in industry. The government is also selling its undertakings.

As the private sector expands, more and more jobs move there. Here, a problem arises for the Indian state: where do the SCs, STs and OBCs fit in? The private sector does not permit reservation as, in FICCI’s words, it would compromise ‘merit and competitiveness’ in Indian industry. That the same industry ignores merit in selecting the promoter’s sons and daughters for top leadership is proof of its gross hypocrisy, but we will leave that point out here. We will keep our focus on what the industry has been doing to correct the historical wrongs the lower castes have suffered in society. We are talking of reparation for social injustice.

Does the private sector not have a duty to build an equitable society? Should it not be committed to inclusive growth? After all, it enjoys huge benefits from the State and taxpayers— land at low prices, subsidies, incentives and tax concessions. Should it be concerned only with its own prosperity and not with the prosperity of those who are at the bottom rungs of the polity? The private sector might refuse reservation. But what about affirmative action? What about equal opportunity? These are policies followed by businesses even in the Western countries to provide jobs to racial and ethnic minorities. The Western businesses were once vastly prejudiced in favour of dominant communities, such as Whites. The Indian businesses are similarly prejudiced in favour of upper castes. They need to reform themselves.

Studies have shown entrepreneurs and higher executives in India’s private sector are mostly savarnas (upper caste Hindus) as against the avarnas (Dalits and Scheduled Tribes). They were historically privileged to take higher positions. They also enjoyed the advantage of having people to recommend and help them everywhere. The Shudras, though part of the caste hierarchy, lose out because they not only lack the educational, familial and cultural background but also references from higher echelons of the kind the savarnas enjoy.

According to the State of Working India, published by the Centre for Sustainable Development, Azim Premji University in 2018, the upper castes were ‘over-represented’ in high-paying occupations (professionals and senior managers) and the Scheduled Castes and Scheduled Tribes were ‘over-represented’ in low-paying ones (elementary occupations). This can be called anything but inclusive growth.

The industry can procrastinate on affirmative action only at its own peril. One of the reasons why reservations in public jobs and college admissions for SCs, STs and OBCs were introduced was to prevent the collective discontent of these castes from bursting into rebellion. That could pose a serious threat to the stability and security of both business and the country.

It was about a decade after the Congress opened up the economy that the party sensed a growing unease among the lower castes that they were going to be losers in terms of employment with the shrinking of the public sector and expansion of the private sector. “What is there for us in liberalisation but exclusion?” the leading voices of these communities said, asking for a quota in the private sector.

In order to tame their feelings, the Manmohan Singh government set up a coordination committee for affirmative action for SCs/STs in the private sector in 2006. Affirmative action was the middle path the government chose in order to keep both the marginalised sections and the private sector happy. It was a kind of guidance—not a compulsion—to the business class to accommodate the ‘unease’ of the marginalised sections. Top leaders of industry bodies FICCI, CII and ASSOCHAM joined the committee, which worked under the PMO, and agreed to implement affirmative action ‘voluntarily’. They drew up a voluntary code of conduct (VCC) for commitment of members to work on a 4E initiative— education, employability, employment and entrepreneurship—for SCs and STs.

The progress on the affirmative action taken by the industry has hardly been remarkable. Thirteen years after the committee was set up,A a report in 2019 said only about 19 per cent of the 17,788 member companies had adopted the VCC. Even these companies had worked largely on just three of the 4Es—education, employability and entrepreneurship—and not focused on the crucial E, employment.

They had given free education, coaching and scholarships to 311,218 SC/ST candidates, vocational training to 653,347, entrepreneurial training to 18,901 and employment to 127,973. Considering the span of 13 years, they hired 9,844 SCs/STs per year. Is that a majestic figure? Does it prove the industry is fostering structural changes in society?

The industry does not even reveal who these 9,844 SCs/STs hired every year were. Were they from among the candidates whose education and training it supported per year? Or were they from the SCs/STs usually hired in the low-paying jobs and counted for affirmative action? Or were the contractors’ numbers added to it?

It is clear that what the industry is doing in the name of affirmative action is not an action to change the society, but just another form of philanthropy. In the neoliberal economy they are the job creators; they have to go beyond the corporate social responsibility insignia they have worn, used and exploited for years. The era of charity is over. This is the era of social justice. They have to partner with the State in ending social apartheid.

The lower castes today face two problems with regard to employment in the private sector. One is exclusion, the second is their ‘over-representation’ in low-paying jobs. The industry has to reverse this trend. It has to guarantee that its employment and outsourcing policy is consciously guided by the principle of social equality. It has to pick lower caste candidates for high-paying jobs. It has to reorient its training programmes to equip lower caste employees for higher positions. And in such numbers that the dominance of the upper castes ends.

That will be the Indian industry’s transition from philanthropy to social justice.