In 1997, the Burman family that owns Dabur India, commissioned a study of their business by consultancy firm McKinsey & Co. which told them that for the business to grow better, family members should give up executive roles. It was startling advice, but the Burmans took it, leaving Dabur entirely to professionals. Since then, only the chairman and vice chairman's positions have been held by the family. Further, neither of them draw salaries, their income coming only from dividends. "These (two roles) are also rotated within the four branches of the Burmans by the family council," says Amit Burman, Vice Chairman, Dabur India. "There will never be more than four family nominees on the 12-member board," On January 25, 2002, the Burmans also put a family constitution in place. "The constitution incorporates the family values and legacies of Dabur. It defines the family council and how it interacts with our various ventures," Burman adds.
As per the constitution, none among the new generation gets an easy entry into the Dabur India board. "Younger family members are, in fact, encouraged to set up independent ventures and create another Dabur," says Burman. "Only select members representing the family can occupy board positions," he says.
The family council reviews the strategy of Dabur India. A structured meeting is held every quarter where various independent business ventures are discussed. The council's role is to look into the broader business strategy and vision of Dabur India. Family members also meet every Friday over an informal lunch at their Delhi office. "The weekly luncheon is what binds us together," says Burman. "We discuss everything, from business ventures to family matters to kids' education. Everything is brought up before the family elders and their guidance sought."
Published on: Jul 22, 2011, 1:28 PM IST
Posted by: Navneeta N, Jul 22, 2011, 1:28 PM IST