The entire controversy, litigation, work stoppages and other unnecessary disruptions cost Tata Motors millions of money. Public protest and other political tactics slowed down and then ulti- mately stopped Tata’s production. Tata also suffered from damage to the reputation of the company.
The protests, court system, community complaints, etc., had negative effects on the image of the company. The Nano factory was eventually moved to the neighboring state of Gujarat. Tata lost out on its $350 million investment in Singur; cost of relocation to Gujarat was estimated to be Rs 2,000 crore.
13_Tata and singur controversy - unethical practices.indd 155
13_Tata and singur controversy - unethical practices.indd 155 6/6/2012 9:54:50 AM6/6/2012 9:54:50 AM
ETHICAL DILEMMA
Ethical dilemma is a situation when it becomes diffi cult to decide what is right and what is wrong. There occurs a confl ict in the values of the different interest groups. In this case, the interest groups were the farmers, government and the company.
The ethical challenge faced by Tata Motors in Singur was whether shifting or locating business at the cost of society was right or wrong. The main motive of any business is to make profi ts and if the company shifts to any other location after investing time and money in building a manufacturing plant in Singur, it would be a huge cost for the company. The relocation cost as estimated by the company was about Rs 2,000 crore. There was also a lot of delay in the starting of the manufacturing of Ratan Tata’s dream car.
Tata group has built over the years an outstanding image in India and it has always been considered as a socially responsible group. Tata’s name has always been associated with ethical practice, phi- lanthropy and nation building but when the Singur farmers’ interest was projected, Tata’s name was refl ected just as a villain. But Tata Motors while going through most of the chaos and violence at Singur maintained silence on the issue and delegated the voice in the matter to the West Bengal state govern- ment. Tata Motors did various employment-enhancing and community-training programs for the locals, women’s employment, and set up health care clinics at Singur. Thus, the focus of the company seems to be at performing Corporate Social Responsibility (CSR) at Singur even before the construction of the factory.
Does this still imply that Tata Motors was unethical in their approach and is to be considered a villain?
CONCLUSION
The brief analysis of the details of the proposed Tata Motors project in Singur gives us an opportunity to think about the industrialization strategy of the state today.
Had the people of Singur not stood up and defended their land and expressed their opinions in a violent manner, another industrial unit would have come up in that place. But on the other hand, some experts felt that West Bengal has missed a golden opportunity for their development, which was later grabbed by Gujarat.
The general public had different takes regarding this issue, while some thought that in a country like India agricultural land is of vital importance to prevent the country from running into a food crisis, oth- ers were of the opinion that West Bengal, which is anyways an industrially backward state, had missed out of an opportunity for industrialization because the most part of the 997 acres of land is not cultivable and so the setting up of the plant would have not only provided employment to the local people but also would have compensated them fairly, according to current standards.
Again, many people felt that the Tata’s are one of the world’s most respected conglomerates and had just fallen prey to the big battle between two political parties, CPI (M) and TMC, in the state.
Whatever may be the case, the Singur controversy had tarnished the long-standing clean image of the Tata Group as well as caused them a loss of Rs 2,000 crores.
Tata Motors and Singur Controversy: Unethical Practices? 157
EXHIBIT I: Tata Motors’ environmental policy
Source: http://www.tatamotors.com/know-us/policies.php
13_Tata and singur controversy - unethical practices.indd 157
13_Tata and singur controversy - unethical practices.indd 157 6/6/2012 9:54:50 AM6/6/2012 9:54:50 AM
EXHIBIT II: Tata Motors’ quality policy
Source: http://www.tatamotors.com/know-us/policies.php
REFERENCES
http://specials.rediff.com/money/2009/mar/23slide1-the-remarkable-tata-nano-journey.htm http://www.telegraphindia.com/1061228/asp/frontpage/story_7192600.asp
http://naxalrevolution.wordpress.com/category/singur/
Tata Motors and Singur Controversy: Unethical Practices? 159
http://www.icis.com/Articles/2008/09/01/9153231/insight-singur-dispute-could-hurt-india-projects.
html
http://ezinearticles.com/?TATAs-Face-Singur-Farmers---But-Whats-the-Exact-Problem-in- Singur?&id=1514101
http://www.24dunia.com/english-news/shownews/0/Auto-News-India-Law-and-order-problems-at- Singur-forced-Tata-Motors-to-move-to-Gujarat/11151234.html
http://www.24dunia.com/english-news/shownews/0/Tatas-fi le-amendment-to-plea-in-Singur-land- case/10916161.html
http://www.telegraphindia.com/1110629/jsp/frontpage/story_14174290.jsp http://www.skirec.com/images/download/apjrbm/APJRBM-DEC-10/9.pdf http://www.scribd.com/doc/13823105/tata-nanoravish
http://www.tatamotors.com/know-us/company-profi le.php http://en.wikipedia.org/wiki/Tata_Motors
http://www.tatamotors.com/know-us/policies.php
http://en.wikipedia.org/wiki/Singur_Tata_Nano_controversy, www.tatanano.in/tata-nano-singur-con- troversy.html ,baseswiki.org/en/Tata_Nano_Singur_Controversy.
http://www.iloveindia.com/economy-of-india/automobile-industry.html
13_Tata and singur controversy - unethical practices.indd 159
13_Tata and singur controversy - unethical practices.indd 159 6/6/2012 9:54:53 AM6/6/2012 9:54:53 AM
This page is intentionally left blank.
In a free enterprise, the community is not just another stakeholder in business but is in fact the very purpose of its existence.
–Mr. Jamsetji N. Tata (Founder, Tata Group) No success or achievement in material terms is worthwhile unless it serves the needs or interests of the country and its people.
–Mr. J.R.D. Tata (Chairman, Tata Group)
In 1973, the Employee Union at the Tata Chemicals, Mithapur plant in Gujarat, went on a strike. The unions had earlier been fi ghting with the management to raise the dearness allowance for the workmen at 100% of Ahmedabad Cotton Textile rate. Later the same year, the Sangh, a minority union sent a charter to the management, intimating their intention to go on an indefi nite strike if their demands for a variable dearness allowance are not met.